Wednesday, May 21, 2008

DUG Divergence

Take a look at the DUG chart below. Notice that RSI has made a higher low while price action has made a lower low. The ETF, which is short oil and gas, is also extremely oversold. I took a small position this morning.


FeirFactor said...

I've been trying to research this fund to see how and how well it meets its objective of returning twice the inverse of the DJ Oil & Gas Index.

Looks like they credit default swaps to do this.

Do you think this is a good vehicle for shorting oil?

Trader M.D. said...


I took a long position in DUG today as well.

I highlighted my entry on my blog today.

FeirFactor said...

Nice call here. I put in a limit order on the DUG yesterday afternoon but it got away from me. I think this is a real good setup.

Vinay said...

Wow, your DUG trade was unbelievably well-timed!

Aviator said...

Great blog and congrats on a well-timed trade. The volume on DUG over the last several days is astronomical.