Well it looks like my timing on entry into the UNG was a bit off. I failed to correctly forecast the Nat Gas inventory reports this morning as they declined less then expected (see morning updates ). Domestic production, specifically supplies from unconventional gas fields such as the Marcellus Shale in the Northeast/Appalachia region and the Haynesville Shale in Louisiana, has not declined substantially despite reductions in overall rig counts compared with this time last year. Natural Gas sold off hard and UNG has touched a low of $8.25. However, I stand by my thesis.
Logic
Fundamentals
•Seasonality has beaten it up this winter while we have had warmer than expected temperatures in the Midwestern United States.
•As of Friday, February 26, working gas in underground storage was 1,737 billion cubic feet (Bcf), which is 1.2 percent above the 5-year (2005-2009) average. The implied net withdrawal from storage was 116 Bcf.
Technicals
•Since September the RSI is in a Bullish trend forming higher highs after a bounce off of support at 30 or so.
•The 50 day Simple Moving Average will act as near term resistance.
Conclusion:
Hence, the tape should carry me to about 9.25-9.50 before I have to make a decision.
Patrick M. Ambrus
Managing Partner
Analyze Capital LLC
ambrus.anlzgroup@gmail.com
nice forex website!!
ReplyDeleteThank you.
...(I'd be pleased if you exchange reciprocal link with me.)