No more evidence needed. Oil is headed up!
We had a couple of levels for Oil to go through to confirm the corrective wave up. First was $37.09, and then if there were skeptics, we said $39.03 should put all doubts to rest. We are at $41.01 as of this writing and no doubt remains – the recovery is on.
The targets for Oil remain $62.97-84.87 on the Crude Oil futures contract. Of course, that will take sometime and there will be rallies and pullbacks (Higher Highs and Higher Lows in Dow parlance) along the way. But the evidence is in and the high probability is that it is happening.
I called out a few trades that were good candidates to trade this recovery/corrective wave. WLL had an entry price of $8.57, initial stop of $3.33 and a target of $17.25. The entry was hit and I am in this trade. If new highs are put in, then I will trail the stop up to previous lows. USO had an entry price of $10.33,which was also hit. The stop is $8.10 and I will trail that up as well as new highs are put in.
A new trade idea for this update is TOO (Teekay Offshore Partners.) The fundamental people would cringe at this, but we are technical traders and the Technicals are great! We don’t care why it is going up, just that it is. It could be just a short covering rally and that is fine. The initial entry is just above previous resistance at $6.79, initial stop at $2.62 and a target of $16.09. If new highs are put in, then I will trail the stop up to previous lows. The reward/risk ratio on this is awesome and makes this trade worth taking a look at.
This promises to continue to be exciting (and profitable!) and I will continue to provide updates.
Stay tuned…
