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Thursday, December 22, 2011

Buy Low, Sell High

I have mentioned natural gas as a resource that has been beaten up.  Previously I dabbled in buying the ETF UNG. (natural Gas).

Well that didn't work out as planned, granted i didnt buy at 120 a share, closer to 10 bucks a share, but here we are touching 6.75 a share.

Timing is everything of course.   But the question is, how low does this go?   At 6.75 a share, every 50 cents is a major swing, percent wise.  Also it is possible that this ETF is simply broken. (mechanics of the etf).

I see opportunity, at this price I am thinking a bottom has happened or will be seen in the next few months.  Unlike many other resources natural gas flows 24 x 7, and there is no "savings" by producers to not sell.  So amid any demand weakness vs supply the price drops, to sell all production.

It is one commodity I think is pretty hard to manipulate.  If you like the idea of buy low, sell high, well, I think everyone agrees looking at this chart, we are in the low zone.  The only question is, will it ever be high?

I think so, just a matter of time.
Click here for latest UNG chart.

From WebSufinMurfs FinancialBlog2

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