— Michael Kahn, CMT (@mnkahn) April 19, 2022
Today’s Chart of the Day was shared by Michael Kahn (@mnkahn). It’s a chart of the Natural Gas ETF ($UNG) over the past four months. Natural Gas has gone parabolic in recent weeks, hitting its highest level since 2008 yesterday. However, it reversed hard today with $UNG dropping 7.89% – its worst daily decline in two months. Michael points out that $UNG has formed a bearish island reversal over the past three sessions. As you can see, $UNG has had two similar island reversals in 2022, both of which were followed by sharp corrections in the following days/weeks. The longer-term trend remains higher, but today’s reversal is a sign that the short-term trend is exhausted.