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Tuesday, December 28, 2010


After yesterday's action in nat gas i am becoming more convinced that we have formed a long term tradable bottom. Yesterday Nat gas sold off rather hard but came roaring back and closed higher, creating which to me looks like a triple bottom. Then comes today's news that production has dropped thanks to production shutdowns and you have nat gas on the move. Its up 4 percent on the day and using UNG as a proxy here, 6.30 is the first target and then 6.75 is doable. I would not use UNG as the trading vehicle here since its front loaded on its futures contract. So unless your nimble i might opt for UNL which is a 12 month futures ETN will hold its value better should i be (gasp) wrong!

The treasury auction on the 5 year was a failure and yields are moving up asa result. Markets a paint drying again. Dow up 15, Nasdaq down 5. The mlp index is up 1.50 probably in response to the move in nat gas. TC Pipelines (TCLP) and Atlas Pipeline (APL) are the leaders today. Most mlps are fractionally higher.

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