Here’s An Interesting Way To Play The Strength In Oil

Looking to the indices, on Monday, the Nasdaq opened
firmer and initially rallied but soon began to drift lower. However, it resumed its rally
in early afternoon trading and continued to rally going into the close. This action has it
closing well and breaks it out to new highs.

The S&P put in a similar intra-day performance.
This action puts it at new 1-year plus highs.

So what do we do? Monday’s action is
impressive. Many tech areas that were somewhat questionable such as selected
telecom, selected computer hardware, and the semis put in a meaningful rally.
Although retail still seems to be lagging, their appears to be enough positive
sectors to suggests that the market could be attempting to mount another leg
higher (the majority of the 239 sectors/sub-sectors that I follow are at or near
52-week highs). For now though, since the market is so overbought, I think the
best course of action would be to wait for a correction and then look to enter
if (and only if) the rally shows signs of resuming. Said alternatively, wait for
a pullback.

Considering the above, on the long side, continue to stick
with areas such as commodity related stocks (e.g. metals/mining, oils) that can trade
contra to the overall market.

Looking to potential setups, Overseas Shipholding Group
(
OSG |
Quote |
Chart |
News |
PowerRating)
,
in the strong shipping sector (they ship oil), looks like it has the potential to
resume is persistent uptrend out of a Trend Pivot Pullback.

Best of luck with your trading on Tuesday!

Dave Landry

dave@davelandry.com

P.S. Reminder: Protective stops on
every trade!

P.P.S. Learn my 10 best swing trading patterns and strategies in my new book.

Click
Here.



No risk,
30-day, money back guarantee.