Slow and Steady Outflows In Natural Gas

The only opinion I follow is the message of the market. Any sustainable or tradable bottom in natural gas (NG) is likely to be preceded by a bullish concentration of funds. Natural gas’s diffusion index, a measure of concentration, reveals outflows rather than inflows. This is bearish. NG bulls will likely have to exercise patience until the money flows reverse and paint a picture of bullish concentration.

Natural Gas (UNG) and Natural Gas Diffusion Index (DI)


Headline: Industry Insiders Call Shale Gas a Ponzi Scheme, Invoke Enron — NYT Report

Shale gas has become its industry darling in recent years, thanks to advances in technology, particularly hydraulic fracturing or fracking, in which gas companies inject high pressure water and secret recipes of chemicals deep underground to push out trapped gas.

But with the rise fracking, natural gas’ reputation as a “cleaner” fuel has tarnished. Residents near drilling sites have documented tainted wells and flammable tap water, even an exploding house. Then a couple of months ago a Duke report confirmed that wells near fracking sites contained high levels of methane. An analysis from the EPA in January found lifecycle emissions could be dirtier than coal.

forbes.com