So with oil prices moving back up tomorrow toward $50 level ...
should the oil stocks like XOM do well this week? Looking to play the April $70 call options but not sure if XOM can fight a weak DOW or market in general? Any thoughts ... I believe $60 will hold strong for XOM as support but curious if the market wants to test it first to the downside or if we can rally on strong oil. thx
XOM can't fight the DOW. There is nothing negative about the company...cash, debt, future investments, analyst sentiments...nothing, but having said that, it still can't break free of the general market sentiment.
It was positive that XOM stayed 1-2% higher than the DOW all Friday, but I don't know if it can keep that going. To profit from XOM calls, you need the DOW to go up - and if/when it does, you could profit huge off those calls.
On the bright side, the majority of investors feel that the risk of a rally far outweighs the risk of a sell off right now. It seems the bears have to be pretty exhausted. Only thing left thats scary are those people waiting for a capitulation. I hope that doesn't happen...or at least that it happens after I unload these calls and switch to puts if need be.
The fact that some notorious shorts have come out and said they are now going long means those that bought recently or are buying now are in on the botttom. Basically, the fact that oil is going up meansn XOM will go up. Shorts that think XOM will go down when oil is going up are delusional.