I figured there was too much hype, so I went bear on oil. But the bullish percent index for energy sector suggests some upside for oil stocks, so I would think that any oil-bear position and outlook is very speculative and would need tight stops. $63 remains strong resistance, as it was former broken support and Fibo resistance.
As I said before, we're into choppy territory. Anyhow, I thought you guys might like to read Tertzakian's book. It's a comprehensive narrative on oil's history and prospects. I have my qualms about some of the numbers, hence the proposed prospects of oil, but, all and all, I think it's a worthwhile reading. On another note, I started my own blog last week. I'll be trying to build an archive of what I've learned so far, before I get into the the more current tradeable stuff. Anyhow, do stop by to post your comments.
OIH made new higher high on hourly chart today thus confirming the reversal of its short-term-trend to the upside. Long-term trend remains bullish. I think XLE will follow through. Taking into account both ETFs look overbought on the hourly charts, I'd wait for a pullback (say, $2-3 for OIH) and go long. Seasonality also supports long positions here (February low was made and managed to hold).
Let's see if $63 QM Apr holds... However, Bush visiting Pakistan helps. And, let's not forget the 230,000 miners on strike in Mexico, which could extend to PEMEX. Things do look bullish, although we could see some pullback... I agree with you Serg.
Looks like time to start accumulating OIH and XLE... I'd add a couple of stronger-than-industry stocks like MRO and VLO to enhance return.