UNG / UGAZ Position Update

The UNG long (UGAZ-3x long Natural gas) has built a pretty wide base, it is looking very good for a move longer than a swing trade, possibly even back to a primary uptrend as the long term charts have been in good shape for a long time, UNG has just had trouble making a convincing breakout above its base area to stage 2. I'd say, above $28 and we've entered stage 2/mark up, essentially where the easy/trending money is made.

This is the current UGAZ long position (3x long Natural Gas). There's some room to add here which I'd consider doing on some gap filling as the lateral base area has a lot of chop and several gaps so a long position here if you don't have one and are interested, is still very much within reason and possibility.

 The daily chart showing the stage 3 top and stage 4 breakdown from a large multi-month range, then a stage 1 base forming up, note the lateral movement in stage 1, the reversal process just like stage 3.

The long term 2 hour chart shows stage 3 deteriorating and a leading positive divegrence at stage 1/base. This looks like it has a lot of energy and should be able to break above the former top (stage 3), I'd say a breakout to the primary trend's stage 2 mark up would be above $28 (UNG).

 The 60 min chart showing stage 3 breaking down and a strong leading positive at stage 1/base.

The 10 min chart, etc. The trends are all similar through this lateral chop area which is indicative of a base, especially with divergences like these.

Intraday we are pretty much in line, but since we are still in the base, I'd consider nearly any entry from the $20.70 level to $21.50 a worthwhile entry for a position trade. If you are looking for an options entry, I'd be much more demanding and looking for a deeper pullback which may never come, it's just something you'd need to set alerts for, but with the longer term leading positive divergences I have little doubt any swift move down that is attractive for a call option position, will work out as long as there's enough time and the timing on any such move is confirmed. For now, I'm just putting this one aside and letting it do its thing.