XOP trade ideas
XOP SPX500 AND CL1!$50 oil? Hey lets crank up a few more of them idle rigs. next earnings releases still a few weeks away, no help there. supply will continue to trump demand. stocks are overvalued, that is the understatement of the day. 2008 was overvalued mortgages, over rated. today it is stocks, yes, the only game in town for yield. aka all your eggs in one basket. like sheep flocking to their demise. a fool and his money (and the money of all those he is managing) are soon parted. last one there gets the check. that clicking sounds you here will be the circuit breakers tripping next week. if you didn't go to cash friday, or short this market, well we will see what we will see, just IMO. careful out there folks. These are rough seas, hard to see what is ahead. bond flows increased in force, money flowed out of index funds, vix above 15 now, with legs, this is a real change. bolllnger bands being constricted chart for the 4th time i posted was/is correct, and lets see how it matches up against the previous events. buy on this dip, is what I hear from perma bulls, but i also hear a lot of wishing and hoping without conviction. not for me thank u. us election getting tighter, north korea upsetting folks. next week, more hawkish talk, to set up the fomc meeting raise or not rise and bring valuations down a bit? mmmmmm, what are they up to? all spells volatility.
XOP: Upward Momentum SlowingXOP-The-ETF-for oil and gas exploration, has most likely reached a short term top.
RSI has rolled over,
Phase energy is sagging (yet still positive),
The Alligator jaws are closing,
The Ichimoku Cloud has a red border.
Support is at the last swing (pivot) at $36.50.
Good luck to you. Don.
XOP 32 or 22 target?see chart. Oil goes lower, markets go lower, XOP has to follow. MFI, RSI, and bottom build all ready to burst.
STRATEGICALLY ACQUIRING POSITIONS IN STOCK USING OPTIONSOver the years, I have been strategically acquiring stock in SPY and selling calls against to reduce my cost basis in that stock. However, given the fact that SPY looks a bit "stretched" here, I thought I would look to be a little smarter about acquiring and look to "divide and conquer" the market by acquiring in individual sectors instead of the market as a whole. The SPDR "X" series exchange traded funds are a good way of doing this, since they are generally liquid and cover most of the bigger market sectors that I would want to acquire actual stock in.
For purposes of this example, I'm looking at XOP, which currently has the highest implied volatility of the "X" series. (This isn't saying much at the moment; it's been far higher, so this may not be the ideal point at which to sell a put, just to be clear). Ordinarily, in looking at a "strategic acquisition," I sell the 25 delta put, which is basically the one at the edge of the expected move for the expiry, and usually it's the expiry as close to 45 DTE as I can get. In this case, that's the Sept 30th 35 short put, which is currently paying a premium of .66 ($66)/contract at the mid.
If price is below 35 at expiry, I am put 100 shares of XOP, after which I begin to sell calls against to reduce my cost basis. However, if price is above 35 at expiry, I keep the $66 in credit I obtained when I sold the put.
Occasionally, I will just let the short put sit there and if I get put the shares at $35, I get put the shares. However, I find it equally acceptable to say to myself during the trade, "Well, now I'd like those shares at a lower price, because it seems inclined to move way below my short put strike and why should I pay more for the shares ... ." In that case, I generally roll the put down and out for duration, looking for an expiry in which I can do that and still get a credit, doing so repeatedly until I'm satisfied with the price at which I'll be put the stock or until I can exit the options trade in profit.
Have Energy Prices Found A Bottom? Weekly View Suggests NoIf my art teacher from 1961 (Junior High School) would look at my contribution above, he would probably flunk me for cramming too much information in such a small area. That being said, I have tried to put much information on the chart for you to consider:
This is a chart of XOP-the energy-ETF. I prefer XOP-rather than-XLE-because the high dividends paid by oil companies keep-XLE higher in price.
The chart above is weekly in time increments and has many negatives.
1. The Ichimoku Cloud is moving down. Prices are trading mostly below the cloud, or trading in the cloud with a downward bias.
2. The 89 week moving average is moving lower.
3. The weekly trading channel is heading down.
4. A 5 impulse wave pattern, follow by 3 A-B-C corrective waves has been completed.
5. Prices are now at a 50% retracement from a previous "lower high".
6. Vortex (middle top indicator) is negative, red over green.
Has energy reached a bottom? The daily chart I reviewed is sideways. But the answer may be found in the weekly chart: Weekly is stronger than daily.
I do not see sustainable energy price rises based on this WEEKLY chart.
What would change my opinion?
If we are at a bottom, a trading range with an upward bias would have to be established. Prices would have to trade above the Ichimoku Cloud . The Cloud would have to start rising. The border of the Cloud would have to turn from red to green. The 89 week moving average would have to start rising. I would look for these conditions on a daily chart first with the weekly chart to improve.
Overall, XOP-is indicating a downward bias in energy prices. The inverse of this is trouble for large banks as they struggle with non-performing loans to energy companies. The jury is still out. This "trading range bias" will take the rest of 2016 to decide. As of today I am NEGATIVE on energy prices. I believe they will drift lower.
My apologies to my art teacher from 1961. Good luck to all of you. Don.
xop short updateupdating previous chart, added building the bottom, as before, big green bottom should start building soon. See you at XOP 22.
XOP ABC patternswe are right at the edge of the near term truth. Do we leave the box and start another ABC pattern, or do we bounce yet again off the box's bottom trend line? My guess is another ABC, with the market looking toppy and the price of oil looking downward, with demand slowing after the summer peak and inventories again full. And RSI has plenty of room to run lower, yellow circle. Best of fortunes to everyone.
XOP weekly - 2009 price action - 7/2/2016In June 2009, XOP gave back 2/3 of gains after interim peak. If history repeats, we may see XOP to drop to $28 level in coming weeks (0.618 Fib), and after that will be a good buying opportunity.
Rollover Beethoven & Tell Tchaikovsky The News: XOP Rolling OverEnergy prices, as measured by XOP-are very likely to decline. The-XOP-chart is rolling over to a (likely) new down-trend.
There is substantial resistance at $38. A five wave harmonic pattern with three a-b-c corrective waves has just been completed.
This configuration has not yet rolled-over, but I think it will as the price approaches the 89 day moving average (golden-yellow line).
For those of you who think the USD will get stronger, it stands to reason that the energy sector will get weaker.
Here are the letters and what "TRADE-MAP" means to me (first the letters in TRADE):
1. T : Time and space (Fractals); 2. R : Repeating Cycles; 3. A : Advancing Trend; 4. D : Declining Trend; 5. E : Energy in Phase Forces.
Now the letters in MAP:
6. M : Momentum and Velocity; 7. A : Analysis of Structure; 8. P : Price Performance. There you have it: Don's personal "TRADE-MAP.
Here are "Don's Top Ten Technicals": 1. The Ichimoku Cloud is weak, with lower prices now than structure to the left. 2. Prices will likely fall BELOW the cloud. 3. Prices are falling BELOW the thick red Ichimoku Cloud Conversion line. 4. The thick red conversion line is moving LOWER. 5. The thick black line is the Ki-Jun-Sen baseline of the Ichimoku Cloud and this is very likely to head DOWN. 6. The indicator on the top of the page is RSI / Stochastic , and this is FAILING. 7. The top-side middle indicator is vortex and this is NEGATIVE (red over green).
8. The Top (bar-type) indicator measures the "phase energy", and this HAS BEEN GETTING WEAKER. This suggests the selling has more to go.
9. The red fractal arrows (not pictured) are DOWN.
10. Look to the far right on the chart, around $34.81 You will notice a blue line on the bottom (jaws), with black dots above (teeth), and a yellowish line (jaw) above the black dots. Now, all three are CLOSING, correct? This is where I ask you to use your imagination and envision these three items as the "jaws, lips, and teeth of a SLEEPING alligator, and the alligator will awake to feed into a new DOWN-TREND soon.
The XOP-is different from-XLE because of the percentage limitation of high yield energy stocks (I believe that no more than 2.5% of any one issue is allowed in-XOP). In other words, the dividend payouts in XOP-are not as strong as they are in-XLE. XOP-price action should roll over easier.
Today I would like to close with three quotes from Mark Twain:
1. “Don't go around saying the world owes you a living. The world owes you nothing. It was here first.”
2. “Get your facts first, and then you can distort them as much as you please.”
3. “I have never let my schooling interfere with my education.”
I hope this contribution has been helpful. May all of your trades go well. Don.
XOP the double bottom the world has been waiting forwith increasing RSI values, this could actually be bottom support in September. Where we flush out the remaining soft oil companies that teetered on the brink but survived last low. Could be very ugly for them, and the big boys swoop in and gobble them up for "pennies on the dollar". Contracting world economies from the euro mess and slow down, dollar strength, oil cannot stand up to that pressure, demand slows. The perfect scenario for lower oil, and the what a real double industry bottom requires. Your welcome.
$XLE $XOP $CVX Looks very boolishI think we get a dovish Yellen. Never thought raising rates was ever an option in an economic war
after one month of consolidation, finally moved to upper channelThis is a long month for oil company stocks on ERs. $GUSH $GASL $FCG
$XOP - DailyNow the most overbought in 2 years with the 1.618 extension just above. CCI at 260+ and RSI over 70.. Will need to pull back to S1 at least
TRADE IDEA: XOP APRIL 22ND 24/33 SHORT STRANGLEGotsta go where the volatility takes you when premium selling, and it's still in oil and gas ... .
Here are the metrics for the setup:
XOP April 22nd 24/33 short strangle
Probability of Profit: 70%
Max Profit: $107/contract
Buying Power Effect: Undefined
Break Evens: 22.93/34.07
XOP/XLEA 5 waves impulsive up movement seems to have been completed on the raito of XOP/XLE.
A pullback is expected soon. A break above 0.49 would invalidate this view.
XOP AnalysisLong above $26, which is the 161.8% Fibonacci extension of the October rally
Bullish momentum divergence
Taget of about $32
