Natural Gas is Fizzling
- Posted by Greg Harmon
- on August 29th, 2012
The last time I looked in on Natural Gas ($NG_F, $UNG) on June 26th in Signals Lining Up to Buy Natural Gas it was on the verge of a breakout higher. Now two months down the road it is right back where it was then. But what do the prospects for Natty Gas look like now? Lets take a look.
The daily chart above starts the picture with the first piece of downside news. After confirming an Inverse Head and Shoulders pattern with the break to the upside through the neckline at the last view, it has now retraced and broken back below that trigger. The Head and Shoulders target of 3.60 remains in place until price falls below the right shoulder at 2.17 from mid June. Translation: It can pullback a lot and still be bullish. But the Relative Strength Index (RSI) is also making new lows and falling with a Moving Average Convergence Divergence indicator (MACD) that is negative and growing. Both support more downside. The weekly chart is only slightly better. The pullback from the
new higher high is still above the previous low. The Marubozu bearish engulfing candle forming gives pause before buying though. As does the falling RSI that has yet to break into bullish territory and the MACD that is heading toward a bearish cross to negative. More bad news. And moving out to the monthly view does not change the picture. After breaking down below the 17 year uptrend the recent bounce back higher has done nothing but retest and fail at that breakdown level. The RSI on this timeframe is heading back lower and the MACD has averted a cross to positive. Time will tell but a retest of the recent low at 1.90 looks to be coming.
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
- SPY Trends and Influencers April 18, 2014
- Macro Week in Review/Preview April 18, 2014
- Pontius Pilate Was the First Behavioralist
- Dragonfly Capital Views Performance Through April 2014 Expiry
- Currency Discussion on FX Street
- Premium Earnings 4-17-14
- Enter the Pound
- Time to Sign Up for Netflix
- Premium Earnings 4-16-14
- Risk Rotation or Risk Off: Small Caps, Large Caps, and Foreign Risk