Thursday, January 14, 2010

Making Money with Natural Gas and UNG in February

Natural gas inventories released today showed a sharp drop of 266Bcf. We are still 3.7% larger than last year's, which is also a sharp reduction in the oversupply.

Chart comparing 2009 and 2010 storage:

The reduction in glut is clear. Note how the top red line drops sharply and falls within the 5-year average channel. However, keep in mind that the average curves were changed last week, as we posted last week.

Here are straddles and a strangle for UNG in February:

Computed with StraddlesCalc Tool. The tool shows the maximum moves required for profitability. Actual moves may be lower as there are 4 weeks to expiration.

Note: You may receive technical analysis and alerts of UNG, sent automatically to you, by entering the symbols in the Technical Trend Analysis Tool, (powered by INO). The profitability of the tool's buy/sell alerts on UNG is +72% in the last 2 years, see article.

Please do your own due diligence. This it not advice. Options may cause 100% loss.

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