As many of you know, I have focused on the energy sector for over a decade now.
It’s still my main focus, and I see an opportunity setting up in that market this week.
Broadly speaking, the energy sector is flirting with its 200-day simple moving average (SMA), as it has been for the past several weeks.
The research shows that if this trend remains intact, another upside push could be in the cards for WTI crude oil.
So, it’s no great surprise to see similar activity in some of the strongest energy stocks.
Now, many of you might be wondering how I identify these opportunities.
Well, I don’t use any indicators. There’s nothing on my charts but hand-drawn analysis, volume and the 200-day SMA… That’s it.
I like to keep it simple and take the time to find high-probability, low-risk opportunities.
Does that mean they’ll all play out as planned? Nope, but it helps stack the odds in your favor.
In this business, that’s the absolute best thing you can do for yourself.
Energy Hot Spot
This week, we are highlighting Devon Energy Corporation (DVN), which is a $41 billion independent oil, natural gas and natural gas liquids (NGLs) exploration and production company.
Before we dive into the technicals, we’re going to examine the fundamentals scores…
These three fundamental scores offer traders some insight into underlying risk, and DVN scores well across all three examinations.
While this information does not constitute a buy or sell signal, it’s good to know if the company is on the right track or not.
The Technical Setup
So, how would I set up a trade? Well, my approach to the market is simple.
I analyze the monthly and weekly timeframes of the chart and look for a 1%+ weekly settlement as a trigger to go long above the 200-day or short below it…
Looking more closely at the chart for DVN, the 1%+ confirmation has occurred.
I’ve identified a potential stop loss based on the exchange of power and a potential ascending target at the nearest form of resistance.
While this is not a trade recommendation, I’ll be watching this idea and following up on it in a future update.
Join Me for the Breakout
Now, if you want to get official trade recommendations with specific entry and exit instructions in the explosive energy market, consider joining me at The Speciale Report.
This premium trading service focuses exclusively on the energy markets, so I highly encourage you to check out it out.
We trade crude oil and the energy sector in the futures, ETF and options markets, all of which give members the opportunity to trade at their comfort level.
That’s the beauty of The Speciale Report’s trade ideas… We accommodate all styles of traders.
There’s really something for everyone!
I also host LIVE class sessions every Wednesday in which I share my thoughts on all the markets I’m watching. I hope to see you there next week!
Rules to Live By
“It is not death that a man should fear, but he should fear never beginning to live.” Marcus Aurelius
Until next time, I wish you a beautiful and blessed day!
Yours In Trading Success,
Anthony Speciale Jr.