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XLE

LNG ( Natural Gas ) Breakout from Cup and Handle LONGThis is a classical chart pattern. The bullish continuation would be expected to be about $25.00 of upside given the height of the cup. The short time MAs have crossed the intermediate MA from underneath in a "Golden Cross" while positive momentum just started on the squeeze indicator. Fundamentally this makes sense with the winter heating season and the energy sector the best performing this year. I will choose a Feb 23 call option 15% above current price. ina
LLong
by AwesomeAvani
A glitch in the energy matrix?Something weird is bubbling in the energy space. Before we delve in, let us briefly explain what the S&P Energy Select Sector Index represents. Some of you might already be familiar with XLE, the ETF which tracks the S&P Energy Select Sector Index (IXE). This Index seeks to represent the Energy sector by aggregating a basket of names in the sector. A breakdown of the top 10 Index components shows the Oil & Gas majors taking up roughly 75.41% of the Index, and 91% of the total Index component being Oil & Gas exposure, while the other 9% being energy-related equipment and services. CME E-mini S&P Select Sector Futures, XAE, tracks the aforementioned energy index, with the added benefit of margin offset and deep liquidity. Now given that the S&P Energy Select Sector Index is made up of mostly big Oil & Gas names, we would expect some correlation between the prices of oil and the Index itself. A look at both from the depths of the low in March 2020 till now shows both products moving closely together up until recently, where zooming in we see… the glitch in the matrix.... The 2 have been trading generally in lockstep since the bottom in 2020, but have diverged in a peculiar fashion, since the middle of July, with the energy sector gaining roughly 28% since, while Oil tumbles close to 30%! Has the exuberance in energy stocks been overdone? In our opinion yes and we see a couple of headwinds for the Energy Sector in general: 1) The impressive rally from the depths of COVID has been driven by rising oil prices and share buybacks. Oil prices are now faltering, and tightening Financial conditions/Recession could slow or stop buybacks. 2) Political pressure to apply a ‘windfall tax’ on oil and gas companies could eat into energy companies’ earnings. 3) Stabilized tension from the Russian-Ukraine means lower uncertainty and pressure on oil prices, as supply and demand find equilibrium from alternative sources. 4) China’s continued zero COVID policy means low demand from the world’s largest importer. From a price action perspective, XAE is trading just slightly off the all-time high range, which could prove to be an area of resistance. All things considered, we think this presents an opportunity to trade this divergence either by; 1) Shorting the XAE outright, which means to take a directional view on the Energy Index. A riskier trade. 2) Pair the XAE with the Crude Oil contract, by shorting the XAE and taking a long on the Crude Oil contract. A more risk-controlled approach. Crude Oil Trades at a contract unit of 1000 barrels and the E-mini Energy Select Sector trades $100 x S&P Energy Select Sector Index. Each Index point is 100$ on the CME E-Mini Energy Select Sector Futures contract (XAE) and $1000 on the Crude Oil Futures. One way to construct this spread could be to calculate the contract value difference between the 2 products; Spread = 100 x XAE1! – 1000 x CL1! You can construct the chart on TradingView by typing the above into the product search bar. This will show the Chart of the spread between the 2 products, which is close to the all-time high now. As such we will lean on the short side of this spread, given the outperformance of the Energy Index relative to Crude Oil. We will also keep an eye on the upcoming OPEC meeting on December 4th to gauge the path forward for Oil Prices. The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description. Sources: www.cmegroup.com www.cmegroup.com www.cmegroup.com www.ssga.com oilprice.com
CME_MINI:XAE1!Short
by inspirante
16
4k arrives - plan for the holiday stretch - SPX USOIL XLE BTCEverything included in the video, I do think a turn lower is likely on these markets, but without as many market participants as usual we could have whipsaw reactions for a day or two. A sell down on the half day Friday would especially be bearish for Monday as traders who are long and away from trading will be trapped. Good luck for the rest of the week and happy thanksgiving to you and your loved ones!
COINBASE:BTCUSDShort
by the_sunship
6
The reasons why going long oil is the best trade you can take!In my opinion, the global energy crisis isn't over; hence there are many reasons why being bullish on oil makes sense, and in this idea, I will try to analyze most of them one by one. First of all situation between Russia-Ukraine doesn't look any good, and it also heavily affects Europe, which is essentially directly involved in this war. Currently, gas from Russia to Europe is lost and can't be replaced because Russia has cut flows while someone sabotaged the gas pipelines. At the same time, Europe is about to ban Russian oil from being sold to Europe while also trying to apply price caps on oil and natural gas. All these essentially increase the oil demand (to replace natural gas) while also decreasing production in case Russia cannot sell that oil to somebody else. As if these aren't enough, as many foreign oil companies managing the production have left Russia, its oil production could drop even more as they don't have the knowledge and ability to control the oil fields themselves. The oil prices remain under control simply because the US keeps releasing oil from its SPR while China keeps pursuing its zero Covid policies. The US eventually will have to stop releasing oil from its SPR because the SPR was created for an emergency, not to keep prices low to buy votes. Not only will the US have to stop emptying its SPR, but it will also have to refill it. Also, China will eventually realize its futile attempt to contain omicron and stop its lockdowns. Essentially just the combination of the two would be an incredibly bullish development for the price of oil, as a lot of supply would come off the market. At the same time, demand will increase massively as Chinese citizens want to travel and consume more. Unfortunately, the US and the world are pursuing catastrophic policies regarding the energy sector instead of pushing investments into it. The windfall taxes on the energy companies will discourage investors from putting money in while starving companies of cash they could have used to invest in more energy production. At the same time, many rules against the extraction of fossil fuels and nuclear energy production are making things even worse. As if these haven't been enough, the US is also talking about an export ban, which, if implemented, would have catastrophic consequences for the world and the US. It would create a massive imbalance in the oil market, which would already have severe issues due to the European embargo on Russian oil. Recently OPEC+ announced oil production cuts, and the tensions between the US and Saudi Arabia have increased significantly. While the US refuses to increase its oil output, OPEC+ cut production by 2 million barrels daily. However, here is the thing... OPEC+ agreed to reduce output that it was not achieving. The truth is that OPEC+ has reached its production limits, and most countries are failing to meet their quotas. There is no spare capacity, and it is tough for them to increase their output. Essentially the cut so far was mostly an admission that they can't produce more. Saudi Arabia and OPEC+ want to keep the price of oil around 80$ and are ready to cut production to counteract the Fed's actions to reduce demand by hiking interest rates. There is an ongoing war been energy producers and Central banks, and the more central banks hike interest rates, the more energy producers will have to cut. Of course, with all the rate hikes and the global economy in a silent depression, we are slowly moving into a brutal recession in the next 6-12 months, which could knock oil prices much lower for a while. However, as central banks are already being forced to pivot, dumping reserves and resuming QE, we could see them and governments trying to stimulate an energy shortage, which could increase oil prices. Finally, the US has talked about refilling its SPR when prices are below 60-80$, while the Saudis talked about cutting production if the prices are below 80$. This means that the price area between 50$ and 80$ is worth going long, as the US and OPEC+ are creating a price floor by reducing supply and increasing demand. So what's the trade? Accumulate oil in the 50-90 area. No stops. Target 250-300$. Time horizon - 2 years.
NYMEX:CL1!Long
by BitcoinMacro
24
Constellation Energy $CEG leading the energy transition?Constellation Energy provides power, natural gas, renewable energy, and energy management products and services. They are the largest producer of carbon-free and low-emissions energy in the US. NASDAQ:CEG is in a clear uptrend with great relative strength against its benchmarks. Just look at AMEX:XLE and NASDAQ:QCLN . NASDAQ:CEG is clearly leading. I see an actionable first buy at yesterday's high as that would cancel the outside reversal. It would be very bullish. A second buy point is at $90.20, which would be an ATH. Lets see if the MAs can hold the price.
NASDAQ:CEGLong
by dpuleo19
XLE to break bullish triangle + OPEC cutOPEC threatens to cut oil prices ten times more than in September in an attempt to plug the oil drain. - The New York Times' sources estimate that the agency is considering announcing a cut of between 500,000 and 1 million barrels per day, about 1% of global supply, because the market is oversupplied and demand is softening due to the weakening global economy. This plus the bullish triangle a good take profit could be around 90-93 usd.
AMEX:XLELong
by Fractal-Surfer
2
Comparing XLE performance and XOMFirst thing first, let's take a look at the components of XLE here You can see that Exxon Mobil and Chevron takes up almost half of this ETF portfolio. Unless you are familiar with the FA components of individual stocks, investing in an ETF like XLE can be a cost effective and hassle free approach. Performance wise, you can see that from March 20 to current date, XLE has gone up almost 200% vis-a-vis 170% for Exxon Mobil. Also, buying into individual stocks can be costly as well along with the risks contained in a single company. For detailed explanation, read here
AMEX:XLELong
by dchua1969