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Beware Buyers: 12 Reasons Why The Current Sky High Natural Gas Price Isn't Here To Stay


Due to cold weather, intense speculation, momentum and lame assessments from some opinion makers with appearances on the media, the natural gas price has almost doubled in just 3 months. The nat gas price was $3.5 in October 2013 and hovers higher than $6.1/MMBtu at the time of writing.

Let's check out the charts of the following three ETFs that are bullish on nat gas. Here is the chart for NYSEARCA:UNG that seeks to replicate the performance of natural gas:

Here is BOIL that seeks daily results that match two times the daily performance of the Dow Jones-UBS Natural Gas Sub-index for a single day:

Here is UGAZ that seeks to replicate, net of expenses, three times the performance of the S&P GSCI Natural Gas Index ER:

Back in late 2012, a fellow newsletter provider, Dennis Gartman, was bearish on oil and saw prices selling off. I was bullish on oil back then, and I still recall his bearish words at CNBC: "Fracking here, fracking there, fracking everywhere." Things proved him wrong as oil price has been hovering well above $85/bbl since then.

Back in 2012, Gartman was also bearish on gold, but things proved him wrong again as gold hit almost $2,000/oz. Gartman declared at a later time that he was wrong about his bearish call on gold.

Gartman said a few days ago that the nat gas price could rise to $7/MMbtu, which is reasonable. I will disagree with Gartman once again. And please do not get me wrong. I do not focus on Gartman's calls because of his newsletter. Actually, Gartman's newsletter is not comparable to mine because we focus on completely different target groups. However, Dennis Gartman has been publishing his newsletter since 1987, and his publicly available calls are influential. As such, his calls could support, even temporarily, the momentum to the one direction or the other, trapping many

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