Get out of your profitable trades (and your unprofitable ones) today and let’s sector rotate into oil!
The Dow is toast if oil holds $1 rise today but oil companies are still a bargain at today’s prices and many of them are sitting just on key inflection points that can give them a strong boost.
Remember the Valero rule though – no trades on oil unless VLO is up and get out when they turn down!
You can almost give a monkey a dart to pick this sector but let’s call the following my favorite quick movers:
RD and RDS.A
CVX
XOM (no, really)
PTEN – it was just a small scandal….
MUR – last week’s pick
HAWK
DO
HAL – last month’s pick, keep buying until they’re indicted!
Which brings us to our Trade of the Day:
NGS was at $40 just 6 weeks ago and plunged to $19 last week on bubble bursting reporting. They had a sharp downturn on Wednesday when oil reserves came in high so watch out for a selloff but today is going to be their day!
With today’s storm in NY, they have a pretty clean run ahead of them all the way to the 50 dma of $27.50. They are not optionable so there will be less weirdness in the price action but a $5 move on this stock should make anyone happy! With a p/e of 50 and gas in plentiful supply, I wouldn’t hold onto this to test the ma. Actually I would recommend taking 10% and running on this one with your finger on the trigger at 5%.
Today could be a false run on oil into tomorrow’s inventories so trade carefully. Remember that making 5% in one day is making 1,000% per year without even compounding so have realistic expectations…
