Tuesday, February 6, 2007

Oil & Gas

If you took any crude futures around the time of my January 17 post where I said I was starting to average in, I wanted to let you know I flipped my crude position this AM early in e-trading. I think the cold story is well known now and am not sure crude can move a lot higher now. Ditto natural gas - am out of those contracts now, too (didn't post as it's too volatile - just a weather trade now). Lots of resistance is above. The frigid winter will drain excess inventories in heating oil & natural gas, so I think we can consolidate a base around these levels. Then the next wave of bullish news can take them way up.

I am keeping all my energy stocks for the next move up. I hold them a lot longer as I want long term capital gains treatment. Sometimes I buy calls on dips & flip them on rips, but have none now. I think a hot summer will rip natural gas & the summer driving season will move oil up. We needed this winter weather to eliminate the short term commodity surplus of both to set up the next big bull move for the energy stocks. We got it.

No comments: