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Replies to post #45231 on The TradingEdge
08/13/18 5:59 PM
08/18/18 7:35 AM
So, with the SPDR Energy Sector ETF (XLE) bouncing slightly off a low on this move just below $72, now looks like a good time to start buying. As always with oil, other things need to fall into place as well and there is some headline risk, but the most obvious non-Turkey, supply-side risks seem to be priced in at this point. The Saudis have been essentially caught cheating on the output cuts but have managed to explain it away and avoid any major fallout, and North American output growth has slowed recently.
That leaves the focus on demand. There is some risk of a global slowdown if there is contagion from Turkey, but after a week or so of panic about a problem that has existed for a year or so, that too looks to be fully, if not excessively, priced in to crude. That in turn means that there is value to be had, and whether you play that through an ETF such as XLE or through individual stocks the recent bear run is a buying opportunity.
