Energy Stocks Higher on Volume
A quick scan of “Stocks Higher on Volume” in MarketSmith highlights 5 interesting candidates in the oil and gas, exploration and production industry groups. Many energy stocks are breaking higher, with RS lines above 95. Momentum is bullish, so most of these stocks should move higher over the coming weeks.
HollyFrontier
HFC was a watchlist candidate in late March, as the stock began to show signs of breaking out of its cup and handle base. Since this is a continuation pattern, we could extrapolate a measured move (MM) using the depth of the cup.
HFC will most likely form a higher base soon, as it’s reached its target measured move and appreciated (+28%) from the 50 breakout zone in 5 short weeks. You could also sell covered calls if you choose to stick with your position.
VNOM is an IBD50 stock that graced recent watchlists over several weeks. This candidate continues to build a bullish trend, reaching its initial measured move target of 31.00 (+/-). We would wait for a pullback to the rising 9ema for new entries. Last week was a good example, where patience paid handsomely.
Energy Stocks – The Fracking Industry
The companies that do the fracking are a varied lot. There are some big, familiar energy giants in that group, from Chevron Corp. (CVX), ExxonMobil Corp. (XOM) and ConocoPhillips Co. (COP), all of which have delivered healthy returns over the last five years (81%, 41%, and 81%, respectively). However, the big petroleum companies have more often been on the trailing edge of the boom that fracking has produced; only Conoco is primarily a natural gas company and it has shifted away from that recently. More often the traditional oil producers own the leases to the land on which fracking is done, and contract the work out to oilfield services companies. – Source Investopedia
We have a position in Halliburton (HAL).
Hi-Crush Partners LP (HCLP) is another name that popped up on the Stocks Higher on Volume scan. The company produces fracking sands. And, if you think the big energy names will continue higher, this candidate might interest you.
HCLP sits 5% below a recent pivot at 13.25, it’s potential breakout zone. An average of recent analyst targets is roughly 16 (+/-) or about 28% higher. The company reported better than expected results. RS line is rising.
We’re considering a position in HCLP, as continued unrest in the middle east will most likely shine a light on energy, oil and gas, and fracking stocks.
Additional candidates that populated the Stocks Higher on Volume scan.
CNC, FIVN, CCJ, BEAT, CLUB, EAT, MMSI, and THC.
THC is a recent swing. We still have a position.
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Happy Trading,
Vinny
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