Welcome to another scary Thursday edition of the ngetf.com morning update. I am as paranoid as ever. Hence only 9% long currently, and in UNG at that. Prices are trending up still, this could be a good sign.
Though I’m not yet a technical master of charts, I know there is a common idea that once the price breaks below support, that same line can become resistance. This appears to be happening with NG now. Also the month-long down channel from early November is converging with the upward sloping line of resistance. Being that I am green still, I cannot say this is significant. I want to believe if we break above this area around $2.35 NGF20, we’ll have longer run in the $3 direction. I still don’t believe the market is ready to go to $3. Storage and the supply/demand balance is still too weak for that.
From a fundamental view, the ECMWF (weather forecast) has given in to showing a little more cold coming across the US. This will of course translate into more demand, but will only last so long. This may very well be why prices jumped around the time the ECMWF updates its forecast last night. But that move in pricing may be all we get out of a weather update. The market is still oversupplied. Production has been stalling. I may have said yesterday, this could be a temporary low in production. I feel like that broken record. There isn’t a lot more to say about this currently.
I’ll be holding my 9% UNG position and I’m willing to let it ride some today. I will place a stop, but only at $17 today. I want there to be a clear signal that the price is going down. I did get stopped out of my QGF20 position yesterday right at the bottom of the day. It was at a small gain, so I have to be content with that.
I’m doing my best to transition to learning technical indicators in the market and stick with the trend. This week has been difficult for me so know that I’m soaking it in and will do my best to adjust. It’s a hard pill to swallow when you’re wrong in front of everyone.