Scott Nations' Natural Gas Futures Trade

On CNBC's "Futures Outlook," Scott Nations said that natural gas traded more than 50% higher in the last three months because of the seasonal cold weather and the impact of the Hurricane Delta. The production is slowing down due to the hurricane, but supply is still 11.5% above the five year average for this time of the year, explained Nations.

He thinks we're going to burn a lot of natural gas to heat our homes this winter so he wants to be a buyer of the December natural gas contract.

Nations would buy it at $3.15 and he would place a stop loss at $3.05. His target price is at $3.95. With the trade, Nations is willing to risk $1,000 to make $8,000. If the trade goes in the favorable direction, he is going to adjust the stop loss.