Gold ETF Chart: Beware Reversal

UNG Fund Trading

Natural gas is really starting to slide. Wednesday the United States Natural Gas Fund(UNG) dipped below the Sept. low of $8.94 by a couple cents, then moved up into the close. Overall it's not bullish. This could be the start of a waterfall selloff, which is a sharp heavy-volume selloff that lasts three to five days.

Commodity ETF Trading Wrap

To sum everything up, the gold and silver ETFs are on fire as they continue to surge higher. Being ready for a sharp reversal is important, if you want to lock in gains on a portion of your position.

Crude oil is taking its time, but looking ripe for a breakout higher. We continue to watch for some action.

Natural gas continues to get pushed down and it's not looking good for higher prices anytime soon. We are waiting for a shorting opportunity or an oversold condition to play a one- to five-day bounce.

Quick Trading Tip: If you have a position that has done well and has moved up for an extended period of time, be sure to draw some trend lines and tighten your stop, or set a stop, under a tight trend line. Sell some of your position (25%-50%) to lock in gains and let the core position continue to mature. If you get a pullback to a support level (previous breakout level), you can buy back your other part of your position at a lower price.

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