Wednesday, July 23, 2014

Curious difference in Natural Gas's (UNG) two-hour versus daily chart

On the two hour chart, after getting a pesky label out of the way which was obscuring a data-point, I discovered that yesterday UNG came into contact with my proposed lowermost resistance point on the two hour chart (not on the daily chart). This is speculative but I generally have had a good track record when creating my channels and anticipating end points. UNG I think will finally stage a bounce and recover some of its oversold status. The lowermost point in my proposed channel was put in with a descent that took place back in early February.

Because of this dichotomy between the two hour and daily charts we can anticipate another small descent to the support line before it breaks out. This bounce comes on the heals of news that a tropical depression is developing in the Atlantic/Caribbean ("Bertha") and although it is early it may cause a rise in prices next week.

Two hour chart: Six month view showing the origin of my lowermost resistance. Note that yesterday's data point touches the resistance line.
Daily chart: Showing the same six month period as above but no contact with lower resistance. After a small bounce it should descend back to make proper contact with the resistance line.

Jakob Richardson © 2014