I’m feeling Gassy

According to the bible on commodity seasonality – The 2010 Commodity Traders Almanac, natural gas has a tendency to bottom in July and then peak in December. If you have the publication they go into detail on page 147. This is the Forty-Third annual edition and their success is likely due to their large institutional following in the U.S.

Now again a word of caution on seasonal investing because nothing works all the time and the only “sure thing” is that annual seasonal publications will occur once a year and they will say the same thing as the year before. So in this case seasonality always works – otherwise any other seasonal call should be confirmed by technical analysis.

In the case of natural gas the technical picture supports the case for a new bull market. When we study a weekly chart of the natural gas the continuous contract NYMEX (lower plot) we can see the completion of a first up-leg advance from September 2009 low of $2.50 through to the January 2010 peak of $6. The subsequent correction took us back down to the $3.80 level in early April 2010. Our weekly down cycle in now bottoming at week-16 with the price posting at all-important higher low

Unfortunately if you owned the toxic Horizons BetaPro NYMEX Natural Gas Bull+ ETF (TSX-HNU) you would not feel too bullish on natural gas. Note the recent 52-week low on the HNU. There are much better ways to enjoy the new gas bull. Our Level I and Level II seminars cover all this material. The current Oakville dates are May 4 and May 6, 2010. To enrol visit www.gettingtechnical/seminars our use this link http://www.gettingtechnical.com/07_seminars/index.shtml