If you're an adrenaline junkie with a taste for downhill skiing
and steep drops, United States Natural Gas (
) may be for you.
[caption id="attachment_55299" align="alignright" width="240"
caption="Natural Gas: sputtering"]
Those holding a short position in the exchange traded fund are
profiting as UNG is down 42.18% for 2012.
Momentum traders shorting UNG have done well, while those
betting the ETF would revert to the mean have been floored.
For the last week of trading, United States Natural Gas is down
5.02%. In the last month, it has fallen 17.46%. The last six months
has seen UNG plunge by 56.37%, and it's down 65.58% in the last
United States Natural Gas is now at its 52-week low. It has a
relative strength index rating of 24.03, indicating the stock is
oversold -- but with a short float of 47.59%, many investors expect
United States Natural Gas to fall even more.
In no way, shape or form is the trend the friend of those long
on United States Natural Gas. The exchange traded fund is trading
double digits below 20-day, 50-day and 200-day moving averages. It
is 11.16% below its 20-day moving average and 51.65% beneath its
200-day moving average.
The candlestick patterns have been negative and of uniform size,
which indicates sustained selling. Volume has been light and
the beta is well below average at 0.12, which is a good sign. On
the other hand, UNG has closed near the bottom of the Bollinger
Band, which is bearish.
Smart money such as
Wilbur Ross sees natural gas rebounding
, but based on these technicals, it
won't be happening anytime soon