Sunday, March 27, 2011

Oil and Gas

Our readers know that oil and gas has been our favorite sector to trade for a while. Most of the charts in the sector though have rallied significantly in the last little while and are quite extended. Here are a few that are on our screen:
Let’s start with a driller that actually is under-performing:
We like RIG 74-75 on support, or on breakout of trend-line on strength. Anything in the middle we’ll leave alone:

The next six charts all belong to refiners/marketing sub-sector.
HOC is our favorite (and we got long on anticipation of trend-line break on Friday and are holding). Next resistance is 60 and 62. Great chart.

VLO beautiful bounce from 50SMA. Nothing wrong with this chart but a bit of basing under recent highs would make it look even better (and give us an entry!).

FTO similar chart but more extended from 50SMA. Very strong, and looks like it wants to get out of this recent range asap. Too extended for us to swing but active traders will probably be interested in 29 for a quick one.

WNR a bit more messy and no clear spot yet but a few days under 17.5 would set it up.

TSO made our newsletter after Japan for a target trade to 26 which worked great. It’s now regained that area and looks to be grinding higher. Too extended for us to get involved.

SUN the strongest of all and has already broken out. Very impressive but too late here for our style.

The next charts belong to the sub-sector of independent oil and gas:
Nice basing here under 78 for NFX– this could be a nice one if it can sit for a few more days.

Similar chart here for DNR to a lot of the refiners, again, too Vish for us, needs to base.

OXY trying to lift off from 50SMA. Not a bad swing right here with stop under 50SMA.

Nice action PXD as it lifted from 50SMA, again decent entry right here with stop under Thursday low.