If you study the chart of oil even before the events in Saudi Arabia I believe there was a chance oil was headed for a breakout. Oil had been consolidating in a tight range right under the 30-week moving average and had tested the moving average for multiple weeks in a row. What happened over the weekend could have expedited what was perhaps going to occur anyway, but now we will never know.
What we know now is oil has broken out above resistance and could now be in a Stage 2 uptrend. Unfortunately besides big winners like CRK it’s still hard to find oil and gas stocks breaking out into Stage 2 without overhead resistance and with a previous Stage 1 base. However if you do some digging (pun intended) it’s possible to find more breakouts such as WTI below, which I took a position in.
Disclosure: I am long WTI.
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