UNG

Thursday as usual we do have the EIA Nat Gas report, at least with that one they give you consensus. Nat Gas has been getting knocked around by talking head on TV lately, "A warm winter" blah, blah, blah. They don't get it, UNG's huge change in character which is when we first started following UNG and then the huge change in trend (some of you are up 20% to 45% and it hasn't even broken out of the base to stage 2 mark up) has nothing to do with winter forecasts and everything to do with US energy independence and the new law signed this year on power-plant emissions which makes building a new power plant in the US a two proposition scenario, nuclear or natural gas; clean coal can't pass those emission laws.

Don't forget all of the strange stuff like the congressman pumping Nat Gas during Bernie's semi-annual Congressional testimony, as if Bernie was an energy expert! However the congressman knew that every investor out there would be watching, it was like a super bowl ad for nat gas.

 Why do we like UNG other than the huge change in character?

 For starters the 2 hour chart's leading positive divergence through the entire base.

 UNG is a longer term position, not a trading one and it should provide a great gain for those who can stick with it, it needs to break out of resistance with a big volume spike, this is what traders believe is a sign of smart money buying, but as we know, smart money was in long ago. That move up and spike in volume are a billboard that tell traders, "Look at me!" and that's when UNG moves to stage 2 mark up or where we see trends.

 It's not uncommon for an equity to back off a major resistance area and gather a head of steam before going for the breakout so this trade is pretty normal.

 On the 30 min chart locally there was no negative divergence in UNG, it doesn't look like anyone is letting go of shares, instead it seems they talked it down.

 On a 15 min chart in yellow, no neg. divergence.

 15 min chart zoomed in shows some recent accumulation in the area.

 Even a 5 min chart shows almost no distribution which they usually need a little to get  pullback moving, there's a nice leading positive today.

The 1 min chart shows a bit of distribution, but this is tiny, we have a decent intraday move here, I think it's probably a good area to continue to build on.