Friday, August 20, 2010

Energy Stocks

In keeping with our sector theme, below are some energy-related ideas across different time frames to illustrate how trends can make great swing trading vehicles regardless of time horizons. 

OXY_Weekly Trend Model

Occidental  Petroleum will always have a place in my heart.  It was the summer of 1978 and I was on vacation in Chilmark, Martha's Vineyard.  During a rare bout with sobriety I purchased some OXY options that  tripled in value in the ten days I was on holiday.  This was a time before personal computers, cell phones, or instant quotes, just me, a transistor radio on the nude beach, a dial-up phone at the cottage and a Merrill Lynch broker in Atlanta.  The birth of a career, a passion and a new found respect for lucidity even when all those around you are crumbling into chaos and debauchery.

SCO_Daily Trend Model

The investment will seek to replicate, net of expenses, twice the inverse daily performance of the Dow Jones AIG Crude Oil Sub-Index. 
Note the pattern of whips-saws followed by huge percentage gains.  Discipline and money management are all that need be added to this model.


 SCO_15 Trend Model

Although I don't presently trade this 15 minute model, the chart makes a compelling case for doing so.  


Market Notes 

I am not going to use the C word today, but the elements are building and I'll likely be going into a more detailed evaluation of the potential in my Weekend Update. 

6 comments:

Anonymous said...

I believe your 15 minute SCO is a good signal for long oil

HES 51 area
STO 19 area
PBR 34 area

oilers down today,(dollar up) look like theyve bottomed and formed bottom holding

before

S+P did.

S+P dropped lower
and is now looking to set bottom.(as in 'todays bottom) (this weeks bottom)

Of course this could be just one step down before the next step down.

but These prices for select oil stocks arent too bad

PBR @30-34 (today 33.90)
STO @ 18-19 (today 19.33)
HES @ 50-51 (today 51)
HK @ 15-16 (today 15.17)

even XOM @ 57-58 (hitting bottom of bollinger line 58.50)

HUSKF @ 23-25 (today 23.52)

(rock bottom area) = March 2009 bottom

Anonymous said...

Looks great. Can we get an update on how your "biotech basket" stocks are doing?

Allan said...

The biotech basket does not look the same as stocks have been traded in and out of the basket as per their trend models. Same goes for the basket of Gold and Silver stocks. Subscribers were given those trades on a nightly basis since inception of the two baskets.

Anonymous said...

I thought those were "buy and hold" picks, with the idea that buying a bunch of them minimized your risk.

So why would it not be fair to ask how they are doing?

Allan said...

It was fair to ask how they were doing, that's why i let your comment through and you got my answer.

Plus, "buy and hold" is the antithesis of the concept of trend following, so I don't know where you got that from.

Finally, if you want to check up on the performance of any stocks mentioned here, here is a link for quotes:

http://finance.yahoo.com/

t said...

I think Mr.'Anon' was addressing me,A,since it was me talking up oil plays.
he's being cynical,which is ok.
its a fair accusation,since biotech stocks have been weak lately as they have made a major correction off their blast off highs from last fall and winter.

My own positions in my biotech stocks is ok,and hanging in there....because I bought them at good entry points....like NNVC at .81 and ISCO at .66

so I'm not sweating bullets yet.

The breakthrough technology in my select biotech stocks has not failed or faltered (yet)
and so I believe the stock price volatility is a function of sheeple traders panic selling and profit taking ...which is unavoidable, and I might have been smarter to take some profits as well, but I chose to 'hold'

and so I watched 50 thousand dollars in 'profit' disolve this summer.

but I'm mostly 'ok' with it because these are core holdings for me. to own 5 years from now.

I would not have bought any of them at the hyperbolic top.

and I will buy more of them at whatever becomes the bottom.(if I catch it )


ok,Anonymous, now its Your turn to share the knowledge you have and what good things you are investing and trading in. I'd look forward to learning anything good you have to contribute.

T

My choice to buy some oilers today was because I didnt own much oil and want to establish some position for the 'oil insurance' in case of global catastrophe. I like PBR,STO,HK,HES,HUSKF,and UPWRF,and a few others I look at interest me.

but like any stock, I only like them if the price is cheap. and at some support level (which now appears,but may or may not be 'cheap' after another wave down.) so I nibbled a little today.

I'm not invested in much
just oil
gold and silver miners
select biotech
and a few miscellaneous.like uranium(down since I bought it)

I like Allan's blog and I wish more folks would contribute useful thoughts more and cynical pissy b.s. less....or what I mean is...I hope pissy B.S. is not the only thing your mind is capable of expressing.