Monday, September 21, 2009

Natural Gas - At A Critical Level



As I pointed out last week, the $12 level in UNG (natural gas ETF) should act as resistance and that is exactly where the current rally has stopped. As you can see UNG is now consolidating at around the $12 level with the stochastics in the sell zone. Every time this stochastic oscillator reached the sell zone followed by a downturn back below 80, this market has sold off. Only time will tell if this is another setup to sell but one thing is clear, it's a low risk short right here if today's low is broken with a protective stop above last week's high.

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