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Natural Gas (NG quote) has been one of the hardest hit commodities over the past few years. NG is now over 85% lower than its 2008 highs and is now trading back at the same price as it was back in 2001.
This hard hit, out of favor product could be making a bullish inverse Head & Shoulders pattern back at the 2001 low support line!
Belsha…Monthly contago is an issue for sure….Today UNG well rewarded investors, as it gained over 6%!
Yet again, if NG should rally as it did from the same lows as it did in 2002 — from 2 to 15€ in a year — the monthly loss in UNG should be largely compensated…. Not saying though I would play this !
Bob…you are 1 million percent correct that a person should not play UNG! It’s another prime example of how the ETF commodity product world has failed to provide a good product for investors.
If one is open to the futures markets, now that is a different story on this product.
Thanks for bringing up, how not to play Natural Gas should it rally.
Chris
Too bad there’s no good way to play this. The ETF suffers a 5% loss on the roll EVERY MONTH. And most of the drillers have expenses way above the current price.