UNG Testing Complex Inverted H&S Neckline
United States Natural Gas Fund(UNG) is testing the neckline of a complex inverted head and shoulders pattern with an open and close above the neckline on a gap up in price today.
Based on the orange line measurement taken from the lowest point of the head to the neckline we get $1.89 which can be applied to the opening price today above the neckline and gives an upper price target of $9.92 to watch for which is in the same area as the red horizonal resistance level stemming from the early march spike up to and rejection from $10.
Inverted complex H&S patterns have a 71% success rate which means we multiply $1.89 by .71 to give us an initial upper price target of $9.33. Assuming that we have a successful breakout of the neckline to confirm the inverted H&S pattern profit-taking should be begin at the $9.33 level and peak in the $9.92-$10 range for short-term traders. Personally, I tend to just raise my stop-loss level as price moves higher rather than selling at the upper targets in case price continues to move above the projected targets. This gives me wiggle room for price to fluctuate at resistance/target levels while also ensuring that the trade is profitable should price reverse and I get stopped out.
The lower PPO indicator shows the green line rising after crossing back above the purple signal line which indicates short-term bullish momentum. Both lines trending above the 0 level indicates intermediate to long-term bullish momentum.
The lower TDI indicator shows the green RSI line rising above the 60 level which indicates short-term bullish price trend. The green RSI line is also trending outside of the upper white Bollinger Band which indicates extreme bullish price trend; generally you want to remain long when the RSI is trading outside of the upper BBand. Price tends to correct to the downside when the RSI line falls back below the upper Band so keep an eye on that when it happens if you are are short-term trader. Overall, when the RSI is trending between the 40-80 levels as it has been sine mid-June the the intermediate to long-term price trend is considered bullish.
Overall, UNG is looking strong with bullish trend and momentum indicators as the price of Natural Gas moves higher along with crude oil.
My buy price was $6.93 putting me up about +15% on the trade so far. Stop-loss is still sitting at $6.54 which is where I set it the day I bought, likely will move it somewhere around $7.50 tomorrow to keep me in profit should price reject at the neckline. Should price continue seeing strength this week the stop-loss will be moved closer to $8, just below the neckline.
Info on complex head and shoulders bottom patterns: thepatternsite.com/chsb.html
Based on the orange line measurement taken from the lowest point of the head to the neckline we get $1.89 which can be applied to the opening price today above the neckline and gives an upper price target of $9.92 to watch for which is in the same area as the red horizonal resistance level stemming from the early march spike up to and rejection from $10.
Inverted complex H&S patterns have a 71% success rate which means we multiply $1.89 by .71 to give us an initial upper price target of $9.33. Assuming that we have a successful breakout of the neckline to confirm the inverted H&S pattern profit-taking should be begin at the $9.33 level and peak in the $9.92-$10 range for short-term traders. Personally, I tend to just raise my stop-loss level as price moves higher rather than selling at the upper targets in case price continues to move above the projected targets. This gives me wiggle room for price to fluctuate at resistance/target levels while also ensuring that the trade is profitable should price reverse and I get stopped out.
The lower PPO indicator shows the green line rising after crossing back above the purple signal line which indicates short-term bullish momentum. Both lines trending above the 0 level indicates intermediate to long-term bullish momentum.
The lower TDI indicator shows the green RSI line rising above the 60 level which indicates short-term bullish price trend. The green RSI line is also trending outside of the upper white Bollinger Band which indicates extreme bullish price trend; generally you want to remain long when the RSI is trading outside of the upper BBand. Price tends to correct to the downside when the RSI line falls back below the upper Band so keep an eye on that when it happens if you are are short-term trader. Overall, when the RSI is trending between the 40-80 levels as it has been sine mid-June the the intermediate to long-term price trend is considered bullish.
Overall, UNG is looking strong with bullish trend and momentum indicators as the price of Natural Gas moves higher along with crude oil.
My buy price was $6.93 putting me up about +15% on the trade so far. Stop-loss is still sitting at $6.54 which is where I set it the day I bought, likely will move it somewhere around $7.50 tomorrow to keep me in profit should price reject at the neckline. Should price continue seeing strength this week the stop-loss will be moved closer to $8, just below the neckline.
Info on complex head and shoulders bottom patterns: thepatternsite.com/chsb.html
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