Oil and Gas Stock Daytrading Scans for Monday, August 3
Aug 2, 2015 Oil Stock Scans
Just when things were looking up for the energy sector, Exxon and Chevron ruin the party with terrible earnings. It’s looking like the early week sector run up was nothing more than a dead cat bounce in a sharp downtrend. I’m guessing there aren’t going to be many long opportunities this week, so I will be posting some short ideas in addition to the few long ideas I can find. If the sector is going to continue this downtrend, then we might as well make some money off of it.
Here are the best daytrading setups for Monday:
Suncor Energy (SU) – Suncor is a great play on it’s own, but one thing I noticed reviewing charts this weekend was that all of the Canadian energy companies followed through on their early week bounce and were not brought down by the Exxon and Chevron earnings. Suncor is the best of the bunch having closed above the 8, 21 and 50 day moving averages. The 50ma is at 27.78, so I’m playing long off that point for my stop.
Imperial Oil (IMO) – Imperial is another Canadian company with a great bounce off the bottom without giving much back on Friday’s downturn. It isn’t above the 50ma yet, but it is within striking distance of that ma which is at 38. Other Canadian companies that might be candidates long are Canadian Natural Resources (CNQ) and Cenovus Energy (CVE).
EQT Corp. (EQT) – All of the natural gas stocks are having a difficult time right now, but EQT seems to be rising above the rest of the group. After reviewing the financials of AR, SWN, COG and RRC it is easy to see why investors are moving toward EQT as the preferred natural gas play. While the rest of the group continues to sink to new lows, EQT has been rising, and as you can see from the chart above, could possibly break out to the upside. The formation provides a great fixed risk entry position to try a trade long with a stop on the 21 day moving average at 76.54.
Frontline Shipping (FRO) – Frontline operates a fleet of crude oil tankers and has recently been moving up with many other shipping companies. As you can see, it broke out from 3 and has been consolidating between 3 and 3.25 for the last couple of weeks. The trade here is to play it long with a stop on 3.00 hoping for a breakout to the upside of the consolidation zone. There is a chance it breaks down to fill the gap to 2.75, and maybe that is also a good spot to play it, but I’d like it to show more strength and avoid filling the gap and breaking out to the upside past 3.25.
Cameron International (CAM) – My long pick out of the oil services sector is CAM. The chart above shows a strong 2 day candle formation on the dip below 50, which could possibly be the low for this stock. 50 is definitely the line if the sand and the play is for an entry close to 50, using the 49.75 level as a tight stop. The 50 level was good resistance earlier in the year and seems to have turned to support around May, with another test in early July. When it finally broke down, it reversed quickly suggesting that there are many buyers looking to get in on any dips below that level.
PDC Energy (PDC) – Although you could probably throw a dart and hit a short candidate, PDCE has an advantage in the trade that many stocks don’t have. In the chart above you can see that the 200 day held as good support in March and again early in July before it was broken in mid July. The stock is now retesting the 200 from the underside, and if it fails, it could be a quick fall. The advantage here is that the trade has a fixed risk stop to play off of. Look for a short entry near the 200 ma and place the stop above the 200ma far enough to be outside the noise level.
Other Ideas
Enservco Corp. (ENSV) – This is a swing trade candidate. I played this recently from 1.02 to 1.20 and it looks like it may be setting up for a repeat of that move. If it dips under 1.00, it’s probably worth a swing long back to the 1.20-1.30 range in 30 days.
Key Energy Services (KEG) – Key Energy is falling fast and this is strictly a play to catch the bottom for a huge bounce. Watch the volume and if it looks like capitulation, there could be a 20% bounce in the stock. Very risky trade, so play small.
Valero Energy (VLO) – I’m not sure about the refiners since they have already had a big run, but if oil keeps falling, these stocks will continue to benefit. Valero is back at that breakout point around 64 and has had difficulty getting back above the 8 and 21 day moving averages, which is why I’m a little hesitant on it. If it can get back above those two levels, there may be another leg to the upmove.
Tags: Trade Scans