Stock Market Action: Natural Gas On Radar
After some early selling, the markets have floated back to the positive side. This is not surprising as light volume plays a key role in an up market. In addition, the S&P 500 broke out of a triangular range yesterday. This means further upside in the next week is likely. The SPDR S&P 500 ETF (NYSEARCA:SPY) is trading at $127.58, +0.09 (+0.07%). The action today is known as consolidation. This is also a bullish signal for the next week with an upside SPY target of $129.50.
Commodities are mixed today. Oil is slightly lower while gold is still moving higher. The United States Oil Fund LP (ETF) (NYSEARCA:USO) is trading at $39.64, -0.05 (-0.13%) while the SPDR Gold Trust (ETF) (NYSEARCA:GLD) is trading at $156.99, +1.07 (+0.69%).
The standout commodity of the day is natural gas. After collapsing almost daily, it is inching higher. A bottom is close if not already at hand. The United States Natural Gas Fund, LP (NYSEARCA:UNG) is trading at $6.63, +0.16 (+2.47%). This may be the commodity of 2012 as it is likely the U.S. government will create many new incentives for its use in cars and trucks. With the energy source trading around $3.00, the risk reward is very solid to the upside.