XOM Analysis: Oil's Next Move & Policy ShiftsNYSE:XOM currently piques my interest, particularly with oil prices potentially stabilizing or rising further. Recent geopolitical developments and policy shifts under Trump’s administration—such as rolling back Biden-era energy regulations, reducing methane fees, and easing LNG export permits—could significantly influence the energy landscape.
My intuition suggests Trump’s "Mar-a-Lago Accord" might involve major global economies reducing holdings of US dollar assets, swapping short-term treasuries for century bonds. Such currency shifts and reduced drilling activity could lead to a tighter oil supply, benefiting prices. Additionally, a weakening US dollar could positively impact technology stocks, as investors rotate towards sectors less affected by traditional commodities.
Technical Analysis (Daily & Hourly Chart)
Current Price: Approximately $103.00
Key Resistance Levels:
Immediate resistance: $103.93 (L.Vol ST 1b)
Important resistance zone: $104.74 (118 AVWAP)
Critical resistance (Last week's high): ~$106.46
Key Support Levels:
Near-term support: $101.13 (Weeks Low Long)
Major support: $97.92 (Best Price Short)
Trading Scenarios
Bullish Scenario (Continued oil strength & supportive policy shifts):
Entry Trigger: Sustained breakout and close above immediate resistance at $103.93.
Profit Targets:
Target 1: $104.74 (AVWAP resistance)
Target 2: $106.46 (recent swing high)
Stop Loss: Below recent pivot around $101.00, limiting risk effectively.
Bearish Scenario (Oil price weakness or production surge):
Entry Trigger: Failure to sustain the above resistance at $103.93 or a breakdown below near-term support at $101.13.
Profit Targets:
Target 1: $99.00 (psychological & short-term support)
Target 2: $97.92 (strong support, ideal short target)
Stop Loss: Above $104.75 to control risk in case of a reversal.
Thought Process & Final Thoughts
Given the current geopolitical and regulatory environment, XOM appears poised for potential upside if oil prices remain strong and policy shifts materialize. However, caution is warranted, as oil companies seem hesitant to increase production due to profitability concerns. Clearly defined technical levels will help navigate trade entries and exits effectively around these evolving macroeconomic conditions.
Earnings Date: May 2nd—Keep positions nimble as earnings can significantly impact short-term volatility.
