$UNG – Natural gas may flame out here but what a run!

Today looks like a blow-off high but…

But UNG (US Natural Fund) sure has given a lesson in what can happen on a technical breakout from a flat base, from 27.5 to 39.5 in eight trading days (see the chart below). Kind of crazy.

I guess it’s a weather report for a cold, cold winter.

Regardless, it’s going to be a buy-the-dips play for some time to come. One would think has to settle down some first or there is going to be a lot of risk, either long or short.

On a contrarian note: aggressive traders might want to look to short it as soon as it stalls, for at least a scalp and possibly a worthwhile dip, with a stop loss to cover at the high of the move at whatever level that is when the time comes.

(click on the chart for a larger view)