Exxon: Higher, Still ?

Major Resistance At XOM: 69 – 70

XOM’s the largest cap in the sector. We’ll use it as the proxy.

Last update has us exiting a short via DUG (not advice, not a recommendation) and standing aside for now.

It’s no secret the overall markets are insane … possibly in some kind of massive blow-off, FOMO top.

At the same time, they look like they’re ‘thinning-out’; that is, only a few are participating in the upward launch.

It’s a bearish warning

Thinning-out, tends to happen at the end or near the end of bull markets.

Looking For The Short

The big money’s made on the downside with down moves being two or three times faster.

The Daily closing chart of XOM above shows it’ still grinding itself higher.

Trend lines below say the upside may be reaching a limit:

If we zoom-in, it looks like there’s significant resistance at the 69 – 70 area for XOM … if it gets that far.

Looking For The News

With the current instabilities, world events, food supply, energy supply, earthquakes, volcanoes, we could get some kind of upset to launch the oil sector higher.

It may not happen.

If it does, that could be the time to re-enter short (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Oil: Froth At The Top

XOP Down, XOM Up

Oil sector proxy XOP, posted outside-down (key reversal) while Exxon (XOM) closed higher.

If we’re in the middle of a reversal, this is normal.

Parts of the sector are already heading lower while typically, the larger caps are the last to complete the change.

This interview with Carter Worth, even though it’s short at only two-minutes thirty seconds, paints not-so-good picture.

He says in a typical scenario that’s repeated twice since the late April ’20 lows, oil has declined by 16% – 20%.

When asked how the equities would do, he hesitates, then says ‘It’s not worth the risk [to be long]’.

It’s a polite way to say they’re likely to get whacked.

Moderna (MRNA)

By now, everybody’s heard the news on Moderna.

Trouble for Moderna was spotted a while back and discussed in this post … along with a prediction that class-action may be forthcoming.

Our stopwatch is still ticking.

Positions

The account positions are short Oil & Gas XOP, using DUG as the vehicle (not advice, not a recommendation).

So far, its been a lot of banging around without much progress either way. However, at this point, a new low for DUG, below today’s low would signal trouble for the short side.

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Exxon Breaks Trendline

Sector Reversal Case Builds

While the overall markets move higher, XOP continues lower and Exxon (XOM) just broke its trend-line to the downside.

XOM is the largest cap in the Oil & Gas Exploration Sector.

We’re using XOP as the proxy and DUG for leveraged inverse.

Over the next day or so, we could get an underside test of the break. However, it was not really dramatic.

With all eyes on other markets like S&P, Dow, Q’s and so on, XOM may just decide to drift on lower …

Positioning:

At this point, there’s nothing that says to cover shorts by exiting DUG (not advice, not a recommendation).

The trade is progressing. So, we’re going to leave it alone.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279