Here is what I am looking at
Very large volume, over the last few weeks the entire amount of outstanding shares of UNG essentially has been traded with a HUGE spike on a day that gives me a sense of capitulation. Then the UNG made a big spike on increasing and well above average volume. Stop set at 52 week low of 14.25. The upside is so tremendous that it is worth attempting here. This is different than a contrarian position in which I continue to add lower, this is my Speculative bottom cal in which I make a leveraged bet using some options. I buy enough time to be able to cut the trade with still plenty of value on the contract and rie the contract out for a very significant gain if we do not stop out.
All the signs of a tradable oversold signal are there. momentum turning positive and MACD turning up, the Slow Stoch and RSI coming off of oversold.
Weekly chart looks good as well and could shift out of oversold as well.
Volume really feels like capitulation and bottom looks to be in for now. The reason I am so excited about this bottom is because super oversold moves tend to rally longer after bottom. So don’t worry about if it hits overbought, I would hold this THROUGH overbought.
