Natural Gas Bear Market Will End (UNG)

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Christopher Mistal: Based upon the Amex Natural Gas Index (XNG) (NYSEARCA:UNG) there is a seasonal tendency for natural gas companies to enjoy gains from the end of February through the beginning of June. Over the past 5, 10, and 15 years this trade has returned 18.3%, 14.4%, and 19.2% respectively. Natural gas itself has been in a bear market since 2008 and arguably since 2005 when it peaked just shy of $16 per million British Thermal Units (btu). Weak demand, due to the Great Recession, combined with a supply glut caused by new technologies and new discoveries has driven the price of natural gas down to less than $3 per million btu, today.

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Posted with permission of author by Wall Street Sector Selector