Oil and Gas Stock Daytrading Setups for Tuesday, August 4
Aug 3, 2015 Trading Blog
It looked like energy was going to pull out of it’s downward spiral mid-morning, but things fell apart and most of the sector closed toward the lows again. Definitely have to be nimble in this market and not stay too long in trades.
Not much happening off yesterday’s scan of mostly long ideas. The two ideas that did work were KEG and ENSV. Enservco even saw it’s highest volume day in a long time. Also, the one short idea that I posted (PDCE) worked pretty well and I wouldn’t hesitate to go back to it tomorrow.
Here’s what looks decent for Tuesday:
Ensco PLC (ESV) – Offshore drillers are getting crushed right now with SDRL down 9.9%, ATW down 4.9% and RIG down 6.3% today. Strangely, Ensco did not follow, finishing the day down only 1.3%. The same divergence happened yesterday with ESV easily outperforming the others in the field. If the offshore drillers catch a bid, ESV is the first choice for a long play.
EOG Resources (EOG) – I had EOG ready for a long today, but just as things started turning up, the entire sector rolled over. EOG is one of the strongest independent E&P companies out there and it is currently sitting right on the 8 day moving average at 76.44. If it can hold the 8 day on Tuesday morning, it could get some run to the upside. Enter close to the 8ma and put the stop just under it if things go south.
Gulf Island Fabrication (GIFI) – Gulf Island builds offshore oil rigs and other structures. As you can see from the chart, there is some upward momentum even in this down sector. If it can take out 12, the next stop is 13, which could happen quickly. The ideal entry on this would be a little pullback toward 11.50, and then a fast run at 12.
Helmerich and Payne (HP) – Onshore drillers were strong today with NBR, HP and PTEN all being green most of the day before the entire sector went down. HP has the strongest financial position of the group and is the better daytrading stock. I’m looking for it to put in a higher low here at 58 and try breaking that downtrend line from mid-June. Hoping for a pullback in the morning and play it off of Monday’s low for a stop. The same setup should work well with NBR and PTEN.
U.S. Energy Corp (USEG) – Daytraders and chatrooms will be all over this one tomorrow, so if you are interested in these penny stock plays, this is the place to be in energy. The best move is to let it come in a little in the morning and base out, then look for a higher low and play off the morning low of day. If it can then get green, the run could be on.
Chevron (CVX) – I don’t normally try to pick the bottom on stocks, but Chevron has reached a really ridiculous situation in my opinion. Look for it to gap down and wash out to around 83 and grab a small position looking for a big bounce. Once it finds a bottom, the stampede back into the stock will begin. When you look around the energy sector, it is clear that Chevron is a quality stock compared to the others and I think it is just getting unfairly crushed with so many funds dumping at the same time. Nobody wants to be in energy right now, which is the exact time we should be looking to buy.
Tags: Trade Scans