A natural gas ETF has bounced almost 20% from its 52-week low with trading volume ramping up on speculation the commodity will recover after dropping below $2 per 1,000 cubic feet for the first time in over a decade.

U.S. Natural Gas Fund (NYSEArca: UNG) rose nearly 5% on Thursday morning to trade just south of $17 a share. The $856 million ETF bottomed at $14.25 a share last month.

UNG is testing its 50-day simple moving average, a level it hasn’t traded above since last summer. The fund invests in futures contracts, so it won’t track the spot price for natural gas.

In a sign of bearish sentiment, UNG puts were “fairly active yesterday and the ETF has traded enormous volume in recent sessions,” said Paul Weisbruch at Street One Financial in a note Thursday.

“It is possible that longs are protecting recent gains or new entrants are potentially speculating on a near term pullback,” he wrote.

Meanwhile, hedge fund manager and natural gas investor John Arnold is winding down his Centaurus Energy Master Fund, according to reports this week.

Arnold shutters Centaurus as natural gas prices hover near 10-year lows, stifling returns, Bloomberg News reports.

Natural gas prices have been hurt by oversupply and an unseasonably warm winter.

UNG is one of many exchange traded products that give exposure to natural gas. First Trust ISE-Revere Natural Gas Index Fund (NYSEArca: FCG), which invests in producer stocks, has corrected somewhat following a week-long rally. [Natural Gas Producer ETF on 7-Day Winning Streak]

The iPath Dow Jones-UBS Natural Gas ETN (NYSEArca: GAZ) is an exchange traded note indexed to futures contracts. However, the ETN is trading at a steep premium to indicative value, setting investors up for potential losses unrelated to the movement of the commodity’s price. [Natural Gas ETN Premium Tops 100%]

Natural gas futures were higher Thursday following a report that U.S. inventories rose less than expected.

U.S. Natural Gas Fund

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