Wednesday, August 26, 2009
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Welcome to Stock Geometry! This casual music and financial blog typically involves posts of music videos and candlestick stock charts looking at intermediate term trends. Think MTV meets CNBC. My positions fluctuate, but I’ll always disclose positions in posted stocks. You are responsible for your investments! – Dr. pythagoruz
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2009
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August
(19)
- Saturday Rock Blog: Like a Rolling Stone
- Our Hero
- Commodity index GSG cup n handle failed breakout
- Is it time to buy UNG yet? (I think so)
- The Bear Market is Over
- Saturday Rock Blogging: Funky Nassau
- ENDANGERED SPECIES: The Bear (eg TYH)
- A tiny hint of a notion that there might be some w...
- The recent rotation out of smalls caps and in to f...
- Saturday Rock Blog: A Little Help From My Friends
- Rally Monkey Gets Fired
- Bankers: "The recession is over"
- Saturday Rock Blog: Sweet Jane (it's a bull trap!)
- A Chart a Day #19: DTG Parabola
- A Chart a Day #18: Auto Zone Clunked
- WTF: Bankruptcy Filings Soar With Stocks
- Keeping It Simple, Honoring My Stops
- 08/03/09 DX, NG, GC
- Saturday Rock Blogging: You Can't Touch This
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August
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3 comments:
Pyth-
I know you're all about the technicals, but this article makes some great fundy arguments:
http://www.thestreet.com/story/10591682/2/natural-gas-heads-for-super-contango.html
UNG is at a 18% premium? ouch.
Hey Gridlock,
Yep, I saw that article last week and I can't really argue with most of the points they make. But if I were going to try and make a fundamental argument for natural gas I'd point to a collapsing dollar, record high crude to natty ratio, coming winter, coming storm season, unprofitable producers, green energy, cap n trade, extremely bearish sentiment on UNG, etc, etc. But I do my best to ignore all of that stuff when it comes to trading. With UNG, I see potential because its at all time lows, I see divergences as it makes these lows, I see a falling wedge but unfortunately I have not yet seen an end to the downtrend that exists on all time frames. Clearly I'm early here but I'm not terribly worried because I see the beginnings of a bull market in stocks and commodities. UNG will move fast when it comes time to catch up with everything else.
On the premium, ya know, I don't really care. The fact that it exists has been good for me because I was long during the time that most of it appeared. In other words, the creation of that premium has led UNG to perform better than it should have while I owned it. Since the premium continues to grow, I don't see it as a reason to be bearish. If arb players want to go out and short this, fine, but the short trade on UNG is overcrowded. Watch for the squeeze...
I've seen a lot of things that don't make sense in this market for over the past few yrs. Just look at AIG recently, or training in GM's liquidation stock. If the UNG premium to NAV is another thing that doesn't make sense, who cares? As long as UNG reasonably tracks natural gas over lets say a few months, I don't care.
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