Oil Drillers Showing Relative Strength
Over the past few days crude oil has been moving lower while the osx has been moving higher. That alone gets my attention for a potential trade on the long side.
Notice how crude oil (USO) has made new lows for the month but the OSX index is making a higher low. I consider that a bullish divergence which alerts me to the possibility of a buying opportunity. I haven't done anything yet but I will watch these stocks over the next few days as potential longs.
I'm hesitant to buy stocks right now since my view on the overall market is still bearish, however I can't let my own subjective evaluation of the market blind me to what I'm seeing take place. If I get a buy signal in oil stocks, I have to take it.
Some of the strong oil drillers I will be watching are: SLB, SII, CAM,ESV,WFT and TDW.... TSO and VLO (not drillers) I'm watching as well.
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4 comments:
kevin:
i still consider MACRO condition will worsen and hence find no solace in such intersing tech pattern..
i urge you take a look at sensex (india) divergence from emerging or SPY..i think sensex could be a leadinf indicator even Barry Ritholtz had some comment on it..
i am still lookin at IBN ..
I agree...IBN looks like it's about to fall out of bed.
Nice post Kevin, I would love to get back into the oil drillers sector. I like your comment on taking action if the buy signals are there, I agree man!
Nice comparison...thanks.
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