The Case for Oil Recovery Gets Stronger and Stronger!

In the first Oil post, I said “if Oil futures go up through $37.09, the recovery is on.”  In the second post, I said “Oil recovery is a go!” after it went through that level.  And, I said pullback would be normal before going on to make new highs.

It is playing out in textbook fashion! If the latest high of $39.03 gets taken out, then that just makes the case for a corrective wave stronger and stronger.

Also in the last post, we looked at WLL (Whiting Petro) as a good stock to play Oil with.  $8.57 was the trigger level to get in at.  That triggered and this trade still really looks good.  Entries are still possible.  Initial stop is at $3.33 and the target price is $17.25.  USO (Oil ETF) was another potential trade.  Entry is good right now.  Waiting for another high to be put in at $10.33 is a conservative way to play USO.  Initial stop is at $8.10 and target is $16.00.

The profit potential on the Oil recovery and these picks are really, really good and it is going to be fun to update them.  I’m looking forward to it and will provide a few updates per week.

Stay tuned…


Oil Recovery is a Go!

Would you mind paying more for gas at the pump, if you were able to make massive profits in Oil related trades?  If we play this right, not only can we buy all the gas we want, we might just be looking at a brand new car!

In my last update, a few days ago, I said that if Crude Oil futures went up through $37.09 with some good momentum, then that would be a clear signal that the recovery in Oil was underway.

Well, it happened and I stand by my analysis.  I think the Oil recovery is a go.

There are several ways to trade the recovery in Oil.  Of course, you can just go long on the futures contract, but that takes a pretty large account to hold contracts overnight and beyond.  And it carries more risk.  I am trading Oil with stocks and ETF’s.

WLL (Whiting Petro) is an Oil related stock that I like a lot.  It is low priced but trades with really big volume.  I’m looking at an entry of $8.57, with an initial stop of $3.33.  If WLL moves with Oil, as it has done so far, we could be looking at a 2X or 3X trade in a relatively short timeframe.  Works for me!

If you don’t like low priced stocks, USO (Crude Oil ETF) might another way to play this.  I’m looking at an entry of $10.25, with an initial stop of $8.13.  USO has huge volume and a very active option market as well.  Whatever option strategy you like for a bullish trend play should do really well.

I’ll continue to provide updates a few times a week.  I’ll update the price pattern on Oil Futures, the two trades that I called out here, and I’ll add a few more plays as this works its way out.

Stay tuned…