XOM UpdateSo I ended up closing out most of my long position today (the option portion, I'm now official, again, a XOM HODLer. Is that what its called these days?
Wow. This was much faster than I expected. I didn't think we would hit 83 until end of February, but wanted to give myself till March. I am still holding a small long position (2 contracts). It's small because its technically violating my rules. When my price target is hit, I exit. No questions. But XOM has been really preforming well and I anticipate great things in the future so I have no problem holding. I anticipate XOM testing the top of the April Supply Zone, then seeing a bit of a pull back. XOM is really overbought as these shorts are all crying about. However, the dangerous thing is, the more overbought it is and, the less pull back is needed to stabilize the RSI. For this reason, and because historically XOM's pull backs from overbought are around 5% I wouldn't advise shorting. But I also wouldn't advise jumping in long for a hold position at this point. My price target was 83 and we even exceeded that slightly today.
I anticipate once we touch the top of that supply zone, we will get a retest back to the top of the bull flag for a roughly 5% pull back. This would be enough to stabilize RSI and let XOM continue to increase in price. Realistically price target could be around 79.50. However, if we break above that supply zone, we could see pull back in the 80$ range. I actually hope to get to the 79.50 area because I would definitely re-enter long.
I haven't updated my regression modelling of XOM to give more of an indepth analysis. To be honest, I don't see the need. The fundamentals are there. The sentiment is there. Its performing well and holding its own. Chart patterns are okay. I don't want to over-complicate a good thing! The only concern is RSI but seeing how SPY and QQQ essentially ran in the overbought zone for the whole year of 2021 on the weekly and monthly charts, Meh. Whatever.
Best of luck and happy trades!
