Natural Gas (UNG) went on a tear, rising over 100% from August through late February. Technically it became very interesting as it broke a year long consolidation channel at the end of January, as seen in the chart below. And even from that point it made a 50% run higher.
But then came the crash. A $2 pullback in just one week. That was surely enough to shake out most players and probably triggered some losses for those late to join in. But that shake out is giving you a second chance in the commodity.
The hold so far at support at 4.50, a retest of the channel break, gives a good basis to trade against. It is also promising that the RSI is holding over the mid line and while the MACD is falling it has not crossed down, signalling a sell. Yes that 4.50 or even the 20 week SMA, roughly equivalent to the 100 day SMA, at 4.39 gives a natural stop loss level either right now against an attempt to hold it long, or on a reversal higher.
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