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SPN

Importance of index analysis ! Short Tech & Long Energy stocks.It is critical to analyze indices when choosing stocks ! SPN (Energy sector of S & P ) outperformed SPX since start of new year . While SPX is officially in bear market , SPN gained above 30 % so far and was above 60 % at it's latest major high !. SPX bounced back last week raising hopes for bulls however, I think it is just a bear market rally and worst may still on the way ! Please note in most bullish scenario SPX may fall down to 3300-3500 level. In moderate case scenario which I believe the most , SPX may see 2400 and in this case Dow will fall down to 18000 ! . This moderate scenario implies for end of about half of century bull run ( from 1974 to 2022) . There is even worse case scenario which calls for completion of 90 years bull run from 1932 to 2022 !!! ( you can see my published video idea about DJIA and different scenarios). Please keep in mind that FED is insisting on rate hikes and we are still at half of rate hike road ! and Mr Powell finally accepted the risk of recession last week. Don't fight FED. On the other side, Oil price is high which brings long term profit for oil companies e.g Exxon ! . Oil high price allows for extension of activities for giant oil companies which brings them more profit for example, margin oil fields which once were not commercial now become commercial and profitable ! . I believe oil is going to stay above 100 USD for long term considering OPEC's production capacity at the peak and simultaneous sanctions of IRAN, Venezuela and recently Russia !. Now lets look at what we have on chart : 1. Candles are clearly below both 50 and 200 weekly moving averages and there may be a possible death cross in upcoming weeks. 2. Chart has lost 0.618 Golden ratio Retracement leve l of the entire up going wave from bottom to ATH. This former support now acts as a strong resistance . 3. Lost golden ratio support beautifully coincides with 0.236 Retracement of the latest major down going wave which makes our resistance even stronger. 4. In terms of Elliott waves , there is still one remaining leg down (wave 5 ) to complete the major impulsive down going wave started at ATH. End of Possible mentioned wave 5 may find the support at 0.786 Retracement level which is a strong supply/demand area as well. All in all , there is no strong support in favor of SPX against SPN. As written on the chart, Technology stocks are among worst performing sectors in SPX in 2022. I believe they have still much room to go lower considering their sensitivity to rate hikes. For example, in case of loosing last support, NVDA will fall at least to 133 or even 75 in worse scenario. On the other hand, energy stocks e.g XOM or COP are completing internal waves of their long term ascending wave 3 . Although they may see some negative days or even weeks , their general trend is up and remind this golden words in world of marketing which says : " Trend is our best friend . " To wrap up , I go short technology and go long energy stocks but certainly in appropriate time and safe trade setup. I appreciate Tradingview's team for giving this chance to authors to participate in this interesting and encouraging competition. Good luck everybody.
Editors' picks
SP:SPX
by SaeedSajedi
48
Why Warren Buffett pours billions of dollars into OXY ?Legendary investor Warren Buffet is pouring billions of dollars into Occidental Petroleum Corporation ! when it rejected heavily from strong and valid down trend line ! why ? Please note Buffett is a long term investor not a trader !. US market has been in a Bull run in large time frames (Yearly or Monthly) since 1932 therefore, any long term investor who chose fundamentally powerful stock has made a huge profit. Although I believe Berkshire could have chosen better time and maybe lower price to start buying shares of OXY, I think it will see higher prices in long term in fact, It goes much higher than ATH and will reach to around 180 USD per share or even higher in up coming YEARS. Now , lets look at what we have in technical point of view: 1. OXY was rejected strongly from valid down trend line in weekly time frame for 4th time . Break out of this heavy down trend line is very important for the stock to go higher. 2. In terms of Elliott waves, similar to many other energy stocks like XOM, COP, SLB and etc , OXY has completed and ascending complete wave cycle from IPO to latest major low (Primary degree waves 1 and 2 on the chart shown by green and red arrows respectively ). It means that impulsive section (Primay degree wave 3) of new wave cycle has been started at last major low around 9 USD. In closer look, currently we are in wave 4 of 1 of primary degree wave 3. Elliott wave labeling on the chart shows internal waves (12345) of wave 1 of primary degree wave 3. It means there is one more leg up ( wave 5 shown on the chart ) to complete wave 1 of primary degree wave 3. Then we will probably have a major correction (wave 2 of 3 ) down to 40-50 level and after completion of correction , wave 3 of 3 which is most profitable and most speedy wave will start. Please note this is most probable scenario and we are not talking about certainty. 3. Beside strong down trend line, there are many strong static resistances on OXY climb road. These Resistances are shown by red horizontal lines on the chart. Therefore, OXY will face difficulties on the way to reach it's target. One more important note : As Berkshire owns now around 20 % of company shares and they are long term holders, We can somehow be sure that 20 % of shares of company will be out of future sell pressure in up coming years which is very important note to be considered. All in all, I believe OXY , like many other energy stocks , offers huge profit for long term investor and traders. However, Is it a right time to open a long position? It depends on personality and risk management and patience of investors/traders. I myself, keep OXY in my watch list and think it can be bought on lower prices as shown by green lines. To me, buying a stock when it is struggling with a strong down trend line is dangerous and as always, I am seeking for a safe trade set up. I Hope this publication to be useful and wish you all the best.
NYSE:OXY
by SaeedSajedi
16
SPX, What is inside and how different sectors recently performedHi Great followers, smart traders and brilliant investors ! SPX was down since start of 2022 and so far showed -13.79 negative performance however, not all S&P 500 sectors are performing the same ! In fact, some of them specially Energy Sector (SPN) is doing great and strongly outperform all other indices (See related idea about SPN VS SPX if interested). What is drawn is a provided table showing different sectors inside S&P 500 along with their Tickers. Their performance since start of 2022 is also added to third column. 4th column shows their price chart position with respect to 50 days moving average. 5th and 6th columns show if they recently made Death or Golden crosses and if yes when they did. Also , it is worth to note indices were sorted according to their performance from top to bottom. Many useful information can be extracted from this table. We show some of them as following: 1. Energy Sector strongly outperformed the market ( I believe this great performance is going to continue. See my publication about Crude Oil and Exxon Mobile Company in related ideas for details) 2. Only two sectors (Energy and Utilities) were positive since start of 2022. 3. Only three sectors (Energy,Utilities and Materials) are above 50 days moving average and all other sectors are below it. 4. Only four sectors did not recently make a Death Cross. 5. Only Three Sectors made a Golden Cross and maintained this bullish status. 6. Health Care sector showing kind of side way trend. 7. All sectors which made a Death Cross has equal or more than -10% negative Performance. What can be inferred for sector selection and stock picking? There are some clues which can be added to other criteria to make our trades and investments stronger. Some of clues are as below: 1. If we want to avoid the risk, we have to avoid taking long positions in the sectors which are below 50 Days MA. 2. If we are going to (( Buy the Dip )) , we can investigate stocks in the sectors with most negative performance. I can suggest Consumer Discretionary at the upcoming new low for example. 3. We have to avoid taking position in side way trends which is Health Care in our study. We can immediately take position in the direction of the trend once it reveal it's upcoming path. Please note this information can be used for initial filtering. There are so many other tips and guides to choose stocks and defining buy/sell point for a specific stock. As always, We do not jump blindly into the trade. Hope this publication to be useful and wish you all the best.
SP:SPX
by SaeedSajedi
12
SPN VS SPX. Its critical to analyze indices when choosing stocksEnergy sector of S&P extremely outperforms S&P since start of market decline on 4th Jan 2022 and in fact, It is not a surprise considering geopolitical conditions. This type of comparisons can help us to accurately select our stock. It is essential to look at and investigate the indices before opening any position. A single stock inside a down trend related index can hardly show a stable up ward move therefore, our first step in choosing a stock has to be analyzing its related index. Good luck everyone !
SP:SPN
by SaeedSajedi