2/1/12
Relevant excerpts from 1/27/12
1/27/12
UNG: (US Nat Gas FD ETF)
We had a mega long term (dominant) pattern (from 2007)of which the down price target was 5.14; we reached it on 1/19/12 when we printed the last low at 4.98 (same day)
it's imperative to reach 6.37 otherwise we will head down to test the 4.98 low.
Generally speaking after the first bout of short covering after such a long downtrend (from 7/08) although this current move down (trend) is from 6/11; none the less there is always a retest (generally several) of the previous low (4.98) as such 5.25 is the key support pivot, (daily) as such 5.08 to 5.14 are potential entry (long) levels
5.64 is the new OAV (120m chart)
NOW
2:25EST
2/1/12
UNG:
We failed to reach 6.37 therefore we're currently testing the last low
A daily close at or below 5.09 is bearish and means we will trade below 4.98
We have minor support at 5.00 not reaching 5.04 is bullish and takes us back up to 5.49 to 5.72 although the key level (resistance) on the bounce is 5.24
At 5.00 expect a bounce, the magnitude of the bounce is not clear, but not trading above 5.24 means it's a mere bear bounce, also not trading above 5.08 means we're heading back down to 4.99
The bigger picture
At 5.98 we developed a double top, the down price target of the pattern is 3.98; IMO we fail to reach 3.98, but a double top on a bottom is as bearish as bearish gets
What is required in order to viably predict the next move is price stabilization for a minimum of 13 hours, currently we're on the 4th hour.
At this point in time I don't see trading below 4.73, not reaching 4.73 upon breaking below 4.98 is immediately bullish, in addition not reaching 3.98 takes us back up to 7.20/7.21
IMO we've either put in a bottom at 4.98 or are in the process of putting a bottom (4.75)
Take into consideration when Israel attacks Iran (they will) UNG reaches 66.00 at bare minimum, more likely 100 to 120
I strongly believe UNG is one of the best if not the best potential play over the next 6 months.