Saturday, August 28, 2021

#OilStocks Review $XOP

Oil Stocks Review
Those that view the message of the market on a daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bag holders of trend transitions.

Oil stocks' overall trend, revealed by trends of price, leverage (futures & options), and time, are defined in The Matrix for subscribers.

Subscriber Comments

The latest Oil Review, a study of the movement of gasoline, natural gas, and oil, through the Evolution of the Trade (EOT), provides the foundation for understanding the invisible hand's intentions in the oil stocks. While the setup may have a similar 'feel', they're clearly different. Please take the time to watch the oil review before reading below.

The Oil Exploration & Production stocks ($XOP) have been in primary uptrend for 8 months, and have produce a 31%. EOT maintains a core long (or short) position that follows the primary trend until either the price or time cycle display extreme extension, or it flips down. Please review the EOT for further discussion of how the computer generate profits.

Name Column (Column D Trends Tab of the Matrix)

The R code and yellow highlight tell us the composite trend has Reset to double upside alignment (Dbl▲). Dbl▲ defines an alignment of daily and monthly trends; the weekly trend is still down. The computer defines the composite alignment as Early, because the composite cycle score (x̅) is -0.63, or less than 0. The negative number that tells subscribers that price and time cycles have a lot of room to run; this is an extremely important concept in the EOT. Experienced users of the Matrix recognize Early cycle setup as highly desirable. As a comparison, Mid and Late cycle composite trend alignments are much older. They figuratively die or end a lot sooner.  Time is needed to make money!

Oil stocks composite alignment, though desirable, is only double alignment. Double alignment is less powerful than triple alignment. The weekly trend must flip up to generate triple alignment (see Composite Trend). Triple alignment occurs when the daily, weekly, and monthly trends are moving in the same direction. Price often accelerates when short, intermediate, and long term traders/investors are all buying and selling. Disagreement between the three time frames generates consolidation or cause building within the cycle of accumulation and distribution.

Composite Trend

The setup in the oil stocks, directed by the commodities they produce and sell, is favorable, but it's still not Triple Alignment. Please subscribe to the Matrix to continue tracking gasoline, oil, natural gas, and oil stocks.

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