UNG / UGAZ Follow Up

Our lastpost for UGAZ (UNG 3x long) trade management was Sept. 24, UNG/UGAZ Update which was a look at the asset which looked great and addressing Cramer the night before saying he liked it, but saw a pullback below July 28th's low of $28.59. While I agree in principle, commodities are a bit different with head fake moves and as I said in the post, "I have no objective data that points to such a move being a probability".

In any case, since then UGAZ is up over 18%, our UGAZ long is up +19.32 % and it's making a breakout move today which needs to see volume pick up and hopefully some follow through so I suspect we'll know a bit more about this move of  over 3% in UNg today , by the end of the trading day, again look for the breakout to hold and increasing volume which we saw on the breakout intraday.

Updated charts...

 Here's the range and if this weren't a commodity, I'd say a downside head fake/stop run below support would be extremely high probability, I simply had no evidence that this was any probability as of the 24th and still don't unless this breakout fails, then it might start showing signals with some probability, but overall this is an excellent long position even on a head fake move/stop run  and I think it has trend trade capability.

The orange area is resistance from a gap and former resistance, the red trendlines are the stage 1 base area. We have price above the base, but volume hasn't picked up on the day yet, although it did at the breakout intraday.

Here's the volume on the intraday breakout which is a nice start, but the close it what really matters here and after that, follow through on the upside. I'm not worried about UNg/UGAZ, if it fails here, I have little doubt it will make the breakout, although I'd rather see it just make it here of course.

 Since the last update, he 30 min chart just grew stronger and has a sharp leading positive divegrence.

 So far the 5 min chart is in line, confirming price action so I don't see any big threat of a failure at the moment. There is profit taking on the move as it is very parabolic which I wish it weren't, as impressive as they look, I don't trust parabolic move, hopefully that fades a bit and we get a few intraday pullbacks creating some support and shaking loose the weak hands.

This is an intraday 2 min chart and the profit taking on a very steep parabolic breakout so not a surprise, but we don't want to see that migrate to the 5 min chart. Volume increasing at the close and holding the breakout would go a long way toward confirming this breakout and of course the one thing the market can't do on the upside (but does easily on the downside) is follow through with additional gains the next day or within the next week as they often will consolidate a bit after a breakout.

Congratulations to UGAZ longs, I imagine most of you got in near the bottom and have a decent near 20% profit in a few days which is nice on its own.