Keep Oil And Energy Companies On Your Watchlist
Michele Schneider | May 26, 2022 12:34AM ET
Energy plays have some of the best chart setups right now from a momentum breakout standpoint. A perfect example of this can be seen in the above chart of the United States Oil Fund (NYSE:USO).
Currently, USO has been consolidating within an upward trend near its key resistance area from $82 to $83. Additionally, at the bottom of the chart, we can find our RealMotion (RM) momentum indicator. Though it is sticking close to the 50-Day moving average (blue line), it has yet to clear back over.
With that said, the best buy signal would be for both price and momentum to clear their resistance levels at the same time. This would confirm that price along with momentum is in agreement since USO’s price is already trading over its 50-DMA. If able to break out, this could boost already strong energy companies even higher.
Energy companies with similar setups are Viper Energy Partners (NASDAQ:VNOM) and CenterPoint Energy (NYSE:CNP).
Both cleared recent consolidation and have momentum either breaking or on the verge of breaking a major moving average. Furthermore, these could be interesting picks, especially if USO clears and holds over $83.
With the Fed setting investors' expectations for more 50 basis point rate hikes, safety plays through energy companies look to have more upside potential.
h2 Key Levels/h2S&P 500 (SPY) 397 pivotal. 380 minor support.
Russell 2000 (IWM) 168 support.183 resistance.
Dow (DIA) 322 resistance to clear and hold.
NASDAQ (QQQ) 285 minor support.
KRE (Regional Banks) 62.17 to clear.
SMH (Semiconductors) 215 support. 239 resistance.
IYT (Transportation) 223 needs to hold.
IBB (Biotechnology) 116.68. to clear and hold.
XRT (Retail) Large comeback day. 58 support.
Get The News You Want
GLD (Gold) Tested and held support form the 200-DMA at 171.67.
USO (Oil) Watch for a breakout over 83.60.
DBA (Agriculture) Watch for this to close back over the 50-DMA at 22.15
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.