An interesting chart (DragonLZ, you may like this)
January 22, 2011
– Comments (9) |
RELATED TICKERS: NGS
, CHK
I was reading through the traders almanac, and it says Natural Gas is bullish in February, which also coincides with the fundamentals (low oil to gas price ratio, and a lot of producers producing below cost which can only be a temporary phenomenon), and the chart which shows a golden cross. There is no good ETF for gas (UNG is worse than aids) so I decided to look at the companies. A lot of the time, underlying commodity prices do not coincide to immediate rise in prices. So, I looked at a bunch of charts and came across an interesting one. http://www.google.com/finance?q=ngs
(I am not sure how to show pictures in the blog, just the link).
If you look, in the 7 years this stock has been around, 6 of those years(85.7% of the time) if you bought it on Feb 1 and sold it on June 1 you would make a profit. I know a lot of people will see this as a nonsense coincidence, but look at all of the catalysts that could make this thing work. When the technicals align, there is usually a fundamental catalyst that shoots it higher, and I think NGS can be a big winner. Unfortunately, options are no good for this because the volume is too light and the premiums are expensive. But it could still rip like a 20% gain.
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