UNG (UNG) Goes on a Ride As Sentiment Turns

April 30, 2012 1:56 PM EDT
United States Natural Gas (NYSE: UNG), an ETF by US Commodity Funds that holds natural gas futures contracts, is up over 3 percent Monday after noted energy analyst Stephen Schork became less bearish.

Schork pointed out that a CFTC report showed that major producers at Chesapeake Energy (NYSE: CHK) and ConocoPhillips (NYSE: COP) are now net long on natural gas, which signals that they are unwilling to sell future product at current price levels and would rather buy product in the future versus produce it. In addition, the inability for natgas bears to keep it below $2/mmbtu is another significant factor.

These two "significant factors" point to a rebound in natgas, Schork said.

The move higher signals a potential reversal in natural gas prices, which have been under pressure for what seems like forever.

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