Do you think natural gas is going to rise in price in the near term?

The long-term prospects for natural gas are excellent, but record levels of supply is keeping price in a downtrend for the short-term.

The intermediate-term downtrend in price is so obvious now, that it has become oversold and favors a contrarian bounce play, especially with oil rallying. But with oil up over $2 today, gas looks a little anemic. I see no strength in gas yet for a directional play to the upside.

The three-wave decline seems to have exhausted itself about a week ago at the 18.63 low in UNG. Now it's basing.

A break above $20 on UNG and I'll be nibbling on the long side (current price is $19.29). But rather than a directional play, and betting that a rally will continue, I'll double my odds of success by selling the Jan 19 puts in UNG. If it holds in this range or goes higher, I'm still a winner either way. If I were to do it today, my breakeven would be $18.41, which is below support at the most recent low. The support level keeps me in the trade on a small decline, and then I don't care whether it rallies or not. Kind of a no-brainer to me, but I'm a trader and know how to manage the trade and manage the extreme risk of selling naked puts. Risk is managed at entry, mostly with position size. I can also exercise the puts if necessary.

I've had a similar position on in GLD since last Thursday, essentially long gold by selling puts. I'm not really betting on a big rally in gold, just betting that it won't go down much. Time decay of the options works in my favor, and the small rally in gold price over the past few days has given me a nice cushion (short the 159 puts and long the 157 puts for a nice credit spread with limited risk).

Yeah, the strategy is a plodder for 23 days or so with limited potential, but the probability of success is about 60% (my average is closer to 70%). The strategy is not very exciting, but a lot more consistent than any directional play. I prefer many base hits to the infrequent home run that rarely materializes. It's really more about probability and number of occurrences than guessing direction on any single play. Staying engaged with several trades on and sitting back waiting for them to expire with no care of direction, beats stressing over how far price will go and where to get out, hands down.

Trying to foretell the future is pointless; can't be done, no future in it.

“Those who have knowledge don't predict. Those who predict don't have knowledge." Lao Tzu, 6th century BC

"Is it just a coincidence that the earth began to signifigantly warm just as the industrial revolution began?" If you are trying to link human actions since the industrial revolution to global warming, can you please explain how human actions caused the medieval warm period?? "Even Bush put the polar bear on the endangered species list due to the melting ice." No, it was recomended. It is NOT yet on the endagered species list, as the scientists take about one year to go through the documentation to make sure it is science and not environmentalism making the decision. "The earth is in temperature cycles that last thousands of years. We are nowhere near the end of our current climate stage, yet republicans claim that this is natural. This is the first time in history that the temperature cycle has changed. It should be a few thosand more years until the earth starts warming. Global warming is not natural!" Wow.....you really have not read any of the SCIENCE have you? Yes larger overall cycles last hundreds or thousands of years, but have multiple temp fluctations inside them. The only given is that we know what happened in the past, and that will NOT tell us what will happen in the future, although environmentalists will try to tell you differently. Global warming is natural, or we would NOT have had similar periods throughout history. "open your eyes, this warming trend is unlike any other." No, it is similar to others, read the data. "90% of glaciers are shrinking." 100% of glaciers are always changing their size....... "Fun Fact - Number of wildlife preserves clinton opened - 203 Number of wildlife preserves bush opened - 2" What does this have to do with global warming? Better fun fact is that Bush's house in Texas is more energy efficient then Al Gore's. "Is a ford expedition really neccesary republicans? I sure see alot of you driving them" And Al Gore flies in a private plane. Planes use a lot more fuel then ford expeditions..... Basically, you are trying to lame the blame of global warming on Republicans, which is a laugh. Wake up, read the science, and realize that by trying to politicize this issue, you will eventually cause it to become trivial over time!!

My opinion is that the price will rise. If the winter is cold, this will happen sooner than later.

However, there are a lot of factors influencing the price, so everything is speculation to some degree.

Best traders have no opinions and reverse when proved wrong.