Friday, September 4, 2009

Natty bottom?

Natural gas is trying to bottom on the monthly S1 pivot(green line marked S1 and blue arrow) after hitting 7 1/2 year lows this week. Natgas has fallen almost 50% in the past 30 days! Is today the bottom or just a dead cat bounce, as the saying goes? Picking bottoms is a very dangerous game! Monthly and yearly pivots can give a clue as where to look for possible bottoms and tops. UNG, the natgas ETF, came within pennies of testing it's yearly s1 pivot(1st yearly support) this morning at $8.65. That's a possible clue that natgas may be close to bottoming. Bottoms and tops are usually a multi-week process.....not a 1 day event..........USE STOP LOSS ORDERS!