PULLBACK TIME?
When you look at the dow chart and see the pattern we've put in place for the past couple of months it seems we go up in the first half of the month and then pull back to the rising moving averages in the second half of the month. So a trip down to 10,000-10,100 is possible in this pattern which takes us back to support. The difference this month is that we do have the seasonal tail wind which could make things different.
MLPS on the other hand have not done much in this rally leg partly because of offerings and the ex-distribution distortions. We went above 265 yesterday and got turned back. 260 ish support is a days trade below us here so the theme here is we've got to watch this carefully. Speaking of which Steve mused the other day in the comments about where we were a year ago. Well here's my post from a year ago today.Another stock offering hit the tape after the close last night as DCP Midstream (DPM) is selling some shares with the stonger stock price. Stock is down a buck and some change in the premarket. Regeny Partners (RGNC) is expanding its gas operations in Haynesville. Those are the 2 driving headlines this morning. Quiet on the upgrade downgrade list.
Stock futures are down this morning by 8 S&P points but off the low of minus 10. The dollar is a little higher and crude a little lower ahead of the open.
joseph cioffi's Source Page - Associated Content
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New NG ETG to debut.
By Tom Lydon on November 18, 2009 | More Posts By Tom Lydon | Author's Website
United States Commodity Funds recently won regulatory approval for its newest addition: a 12-month natural gas exchange traded fund (ETF). The fund is expected to begin trading tomorrow.
The U.S. 12 Month Natural Gas Fund (NYSEArca: UNL) has gotten the green light from regulators to issue about 30 million shares, which will purchase natural gas futures for delivery over the next 12 months. Asjylyn Loder for Bloomberg reports that it will sell the near-month contract as it approaches expiration and replace it with a contract for delivery in 12 months.
The ETF comes from U.S. Commodity Funds LLC, which also manages the popular $3.5-billion U.S. Natural Gas Fund (UNG: 8.93 -0.36 -3.88%) and the $1.96-billion U.S. Oil Fund (USO: 40.53 +0.05 +0.12%).
UNG differs from UNL in that UNG buys the near-month contract, then sells it each month as it nears expiration and buys the next month.
In terms of natural gas prices and futures, what’s the difference between UNG and UNL? UNL can help mitigate some of the impact of contango, which is when the front-month contract is higher priced than the contracts further out. By using the 12-month approach, the impact of contango is, on average, about one-third less than it would be in a fund that simply uses a front-month approach.
Which fund an investor chooses depends on what’s trying to be accomplished. When the markets are in contango, it’s no guarantee that a 12-month fund would do better. On the other hand, it could be beneficial for investors looking to lessen the impact contango can have. On the other hand, if someone is trading frequently and heavily, there might not be as much concern about contango. As the energy markets shift, it could be more advantageous to be in one fund over another - but it’s no guarantee in the volatile energy space. Many have learned that a single hurricane can change conditions rapidly.
Natural gas futures were wavering today. Below-normal temperatures in the Midwest and Northeast are anticipated to boost natural gas demand, but there’s only been modest growth in industrial production, reports Christine Buurma for Dow Jones Newswires. Until today, many traders had been betting that natural gas prices would fall in the coming months.
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