Natural Gas ETF Poised For A Breakout?

In today's trading action, shares of the United States Natural Gas Fund (NYSE:UNG) have erased losses sustained over the last four trading sessions, currently up 2% to $22.33.

As the one year daily chart below shows, shares are once again making a run at a key resistance level ($22.72), which dates back to February of this year. After hitting all time lows in April, natural gas has been slowly rebounding, making a series of higher highs and lower lows in the process. Both the futures (/NG) and ETF have been on a tear recently, finishing higher in twelve out of the last fourteen sessions - a 16% gain in that time.

Should the fund manage to break resistance, look for a quick run to the next resistance level of $23.92. Beyond that, no resistance comes into play until $27.00.

If shares should fail to break $22.70 once again, however, look for a 50% retracement of the recent move to around the $20 mark. $21.40 has served as support over the last five trading sessions. If that breaks, it may serve as a good short entry point.

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

Stock chart:

(c) 2012 Benzinga does not provide investment advice. All rights reserved.