UltraShort Oil & Gas ProShares (DUG) — This exchange-traded fund (ETF) seeks daily investment results, before fees and expenses, that correspond to twice (200%) the inverse (opposite) of the daily performance of the Dow Jones U.S. Oil & Gas Index.
Since the bottom in crude oil in early March, this contra-ETF has been in a steep decline. Recently, though, crude oil broke its uptrend and the DUG chart turned bullish.
Note the higher volume on up days on this chart and yesterday’s breakaway gap through the 50-day moving average.
That gap at $18.76 to $19.33 could be closed by a quick rally in crude. But the trading target for DUG is $25, and if yesterday’s high is broken, that target could be achieved very quickly.
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Sam Collins is a registered, fee-based portfolio manager who may be contacted at samailc@cox.net. You can also check out an archive of some of his most recent market outlooks.
