A Natural Gas Idea

I still don't think that NG bottoms until the end of December. Just basing it off the cycles analysis idea I have going...but NG is tricky. This is what I think may be going on right now on a short term cycle. If this count is correct, then the wave 1 is longer than the wave 3 which of course would mean that wave 5 must be smaller than 3. Soooo, I extended the fib measurement of wave 3 down (assuming we ended this little up move, and what do you know, it fits. Lets see. I do not have a position yet but if NG drops to that blue box then a nice short term long position will suffice.

Comment:

I thought that I would use the DGAZ chart to help show what I think is going to happen over the next few weeks with Nat Gas. Can you see what appears to be a very nice 4th wave in progress right now for DGAZ. So that tells me to expect more upside in NG until DGAZ gets down to about the $127 mark. Then I expect NG to drop for another couple months and fill a very large gap down near the 1.9 area. After that...expect one hell of a ride in UGAZ.

Comment:

I know that everyone was saying that the winter rally started back in August. I was not one of those people. I really don't think that we have bottomed yet. I saw the rally in August as a running flat and was correct. Now I think we have a smaller 5 waves down to at least fill the gap. Lets see what happens over the next few weeks.
For me the safest play is to just wait and see. If I am correct, then Ugaz will be an awesome play for a few months. You see, if you zoom way out you can see that we have been moving down in a decending wedge for many years. We should break out of that wedge at least by January.

Comment:

Short and sweet...I am looking for Natty to finally bottom on Monday. Somewhere around 1.5. Good luck

below is the cycle chart so you can understand why I am thinking Monday.