The OIX has triggered an upside alert at 312 and this index remains in a long-term upward trend. Downward resistance has been broken and a move above the 317 level could see the bull build strength. MACD is edging higher and trading right near the zero level. OK to be bullish here on half positions, with a stop at 305.
January 2001 Crude Oil - last seven months.
We'd like to see the January crude oil contract confirm the move we're seeing in the OIX with a trade above $36. Look for things to get livelier in the coming sessions. MACD is well above the zero level; thus we'd only be entering partial position in the OIX at this time. If this contract were to break new ground to the upside, we could then add to positions at that time.
Bullish Percent for Oil - 2% scale
Last night reading of "bullish percent" for the oil stocks had 56.4% of the stocks in the group on a supply/demand "buy signal". It would take a reading of 58% to get this group back into a column of X's. The above chart helps us with our trading strategy of only taking partial positions at this time, and we're looking for oil stocks that are breaking out of consolidation or trading near longer-term support levels. The lower lows on the above chart give hint that the bull may be tiring, so don't get greedy. New subscribers looking for an explanation of bullish percent should review the archive section for November 8th at 01:30 EST.