Yes, undoubtedly, many a would be-bull in Natural Gas and the U.S. Natural Gas Fund ETF (UNG) has risked life and limb to participate in a sustainable upmove for more than two years, but none has been forthcoming.

This past Tuesday, with the UNG hitting a 27-month low at 5.66 (in July 2008, the UNG peaked at 63.89), the price structure pivoted to the upside for recovery bounce to 6.03. The "micro" upmove exhibited bullish form on my intraday charts. Along with excessively oversold conditions and positive momentum divergences registered also on my intermediate term charts, the upmove suggested strongly that the UNG may have established a very important price low -- a bear market low.

Of course, since the Tuesday-Wednesday rally from 5.66-6.03, the UNG has been on a backing and filling mission, which represents either the construction of a near-term base, or a sideways consolidation area prior to another downleg. As long as near term lows at 5.74 and 5.66 contain any forthcoming selling pressure, I will remain long, looking for another, stronger upmove to emerge that propels price above 6.03, on the way to 6.30 next. MJP 10/14/10 3 PM ET (5.84)

By Mike Paulenoff

Mike Paulenoff is author of MPTrader.com (www.mptrader.com), a real-time diary of his technical analysis and trading alerts on ETFs covering metals, energy, equity indices, currencies, Treasuries, and specific industries and international regions.

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