No Hello Dolly, Or Crude Oil Price Stability

The threat of Hurricane Dolly disrupting oil and natural gas production in the gulf coast helped to stem the slide in crude oil and natural gas prices late last week, but now as reports indicate that production will be relatively unaffected, both have continued their sell-off. As of mid-day, crude oil was down over $4.50, falling below $127 a barrel while natural gas was off over $0.50, falling below $10 per MMBtu. As I write this post the UNG is down -5.72%, while the natural gas company Chesapeake Energy (which I have been following) is getting taken to the wood shed, down -7.47%. This stock certainly looks sick and is already testing the support I worried about earlier in a post written just yesterday morning. Longer-term fundamentals still appear bullish based on long-term projections in supply and demand, but short-term price activity is certainly weak. The crude market has been known to turn-on-a-dime lately, but trading or picking an investment bottom is foolish at best. Giving up a few points to wait for confirmation of the trend is probably the smarter move. As for now, things are certainly looking ugly in oil, and natural gas seems to be going along for the ride. Both seem to be looking for reasons to go down, unlike just a few weeks ago. It is unclear how much of the current moves in crude are based on the recent passage of the Senate bill aimed at curbing speculation.