Oil and Gas Stocks Outlook for Monday, November 20
Nov 20, 2017 Trading Blog
Thanksgiving week is usually a very poor trading time for me with the kid out of school and wife home from work. Just better things to do this week than sit and watch the market in a 50 cent range. I’m going to give it a chance today, but if it doesn’t move before lunch, I’m probably going to be done for the week and go hang out with them and enjoy the week off.
I trimmed most of my holdings on Friday when the XOP climbed over 35. I reviewed those trades and found that the worst performers were the two service companies I had, SLB and NOV. It seems like the shift in attitude by the E&P companies from production at any cost to responsible shareholder returns is really having an unexpected (by me at least) on the service companies. I’ve seen a few companies increase budgets, but many are looking to stay about equal to last year in an attempt to get costs under cash flow. If these service stocks drop again, I might have second thoughts about trying to trade them for a bounce. I’m definitely going to be more careful with them in the future.
I’m looking forward to the trading break this week and hope all of you have a great holiday. I’m planning on giving all my stocks a review when I have free time during the week and will probably throw up a few posts on things that I find.
Outlook for Monday – I’m thinking we probably peaked out Friday with the bounce that started on Wednesday. The XOP made it right back up to the 8 day moving average at 35.05 and stalled out. I wouldn’t be surprised to give that level a test today or tomorrow, but not sure if it can climb back above and stay above it with the light holiday volume. On the downside, 34 seems to be solid support with the 200 day sitting at 33.99 and the 50 day sitting at 33.79. I might get interested in re-buying my positions if we take another trip down there again.
Trading Plan for Monday – Not much today. I’m not a fan of light volume holiday trading. I’m really interested in what we do at the edges of this range, 35.05 on the topside and 34.00 on the bottom side. Anything in between those points is just noise this week. My only trade is likely a few buys on any move under 34 to rebuild the positions I sold on Friday.