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inthemoneystocks

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  1. Oil is bouncing off the $40 per barrel level again. This is the third time it has hit this level and bounced. In terms of technical support, this would be known as major support level. One interesting factor that should be noted as well, in August 2015, oil saw the high thirties briefly. This low remains intact and has not yet been violated. As long as oil holds the $38.25 pivot low, oil stocks should be looked at as long term bargain investments. Many oil names are trading at levels not seen in years. For example, Chesapeake Energy Corporation (NYSE:CHK) and Southwestern Energy Company (NYSE:SWN). Looking at the charts alone will make you shudder. That is usually a good reaction as it shows panic from investors. If logic prevails and the thought is that eventually, oil will grind up to the $75-$100 level again, these plays could literally double, triple and quadruple in value. It is almost wise to view them as an options trade. Sure, in a catastrophic event CHK or SWN could drop 50% or more, but the upside potential is epic with patience. In addition, we are not seeing investors like Carl Icahn dump his investment in CHK either. That is something to pay attention to. Gareth Soloway InTheMoneyStocks
  2. inthemoneystocks

    The Oil and Energy Price Thread

    Just when you thought it was safe to start the car again, gasoline prices are once again heading higher. The average price of gasoline in the United States is around $3.31 a gallon. Obviously, states such as California, Hawaii, New York, and Connecticut are higher due to taxes and environmental regulations. Either way, cheap gasoline at the pump seems to be over for now. Higher gasoline prices act as a direct tax on the U.S. consumer. Light sweet crude, which is the type of oil that we use in the United States is now trading back over $101.00 a barrel. The winter season in the United States has been exceptionally cold this winter. Cold weather and higher gasoline prices are a one-two punch to the U.S. consumer. After all, it is the U.S. consumer that accounts for 70.0 percent of the GDP (gross domestic product) in the United States. While the U.S. consumer has been resilient for the most part higher energy prices are certainly going to take its toll on their spending habits. Traders and investors that want to track the price of gasoline should follow the U.S. Gasoline Fund (NYSEARCA:UGA). Recently, the UGA has surged higher by $4.00 since February 3rd, 2014. Today, the UGA is trading around $59.70 a share. There should be near term daily chart resistance around the $61.40 area, so further upside cannot be ruled out. Some other energy ETF's that traders and investors may want to follow include United States Oil Fund (NYSEARCA:USO), United States Natural Gas (NYSEARCA:UNG), and the iPath S&P GSCI Crude Oil TR Index ETN (OIL). Nicholas Santiago
  3. Recently, the precious metals have received massive media coverage. Some traders say that gold is a bubble and is now bursting. Other traders say that gold is the only safe haven for people to put their money. It is important to note, gold is now in a 10 year bull market. Bull markets such as the one we have seen in gold will simply need to have a correction from time to time. If you ask the average person on the street if they own any gold bullion or gold coins they will tell you no. In fact, most people do not own any gold or silver outside of their personal jewelry. This tells us that gold may be do for a pullback or correction in the near term, however, a bubble is a little bit of a stretch at this time. Gold is the ultimate indicator of central bank activity. When central banks increase the money supply or add cash reserves at the major banks gold will usually trade higher. Many banks are now taking gold as payment and collateral. This tells us that gold is still in demand and more importantly becoming a currency. Back in late April 2011, silver was surging higher, nearing the $50.00 an ounce level. At that time, the CME Group increased margin requirements on four separate occasions. This margin hike caused silver to sell off sharply as many speculators simply did not have enough capital on hand to hold the position. On two separate dates over the past month the margin rates were increased for gold. The price for gold declined sharply from the August 22, 2011 high. Many traders and investors are now worried that margin hikes will be implemented again for gold. This fear of margin increases is now keeping the price of gold contained. This tells us that gold should simply be traded at this time. Remarkably, gold is still holding up very well considering the sharp decline that occurred on August 24, 2011. Believe it or not, gold can still make new highs from here if it can build a base and consolidate around the current levels. The gold bull market is still very much alive. Gold may need to correct or pullback in the near term, however, that would actually be healthy for gold. Traders can watch for intra-day support on the SPDR Gold Shares(NYSE:GLD) at the $176.25 and $175.00 levels. The intra-day resistance levels for gold are around the $178.50 area. Nicholas Santiago InTheMoneyStocks
  4. Germany, already an avid fan of solar energy, announced they would have all nuclear power plants shut down by the year 2022. This was in response to the horrific catastrophe in Japan just a couple months ago. The meltdown at the Fukushima Daiichi nuclear plant caused radiation to spread throughout much of the region and faint amounts around the world. It has been called one of the greatest man made disasters in history. Germany, has always been on the leading edge of alternate energy and has now proclaimed an end to nuclear energy in their country. This announcement was very bullish for solar stocks. LDK Solar Co., Ltd (NYSE:LDK) surged close to 10% before pulling back and First Solar, Inc. (NASDAQ:FSLR) is currently trading at $123.76, +2.39 (+1.97%). In addition, Suntech Power Holdings Co., Ltd. (NYSE:STP) is up +0.44 (+5.47%) to $8.48 while Canadian Solar Inc. (NASDAQ:CSIQ) is trading at $9.69, +0.41 (+4.42%). Solar stocks have been hammered of late because of lower margins and an end to subsidies in many countries. This was the first small bit of good news for the sector in months. Many solar stocks were near 52 week lows. Gareth Soloway InTheMoneyStocks
  5. The markets opened lower with initial weakness in oil. As the morning progressed, oil surged to the upside and the markets followed. Contrary to most retail investors thinking, weak oil is actually bad for the markets while strong oil is good. This is primarily due to the indexes being over weighted with energy and commodity stocks. When oil drops, stocks like Chevron Corporation (NYSE:CVX) and Exxon Mobil Corporation (NYSE:XOM) fall. They are major components of the Dow Jones Industrial Average, thus, the index is likely to be weak. When oil spikes, those stocks are strong and the Dow responds accordingly. The United States Oil Fund LP (NYSE:USO) is trading at $43.23, +0.48 (+1.12%). In addition to oil causing early weakness, Jobless Claims were reported higher than expected at 412,000 and Producer Price Index numbers came in hot as well. The Producer Price Index for March was reported at 0.7% while the core PPI, excluding food and energy came in at 0.3%. This is a scary thing for the markets as inflation is starting to rise but more people are filing for unemployment. The worst case scenario for the Federal Reserve would be stagflation. Stagflation is where there is inflation but no growth in the economy. Think of it this way, usually when there is inflation, there is growth in the economy so people are making more money to pay for more expensive items. With stagflation, they are not making more money and prices are going up. This hurts the population much more. Gareth Soloway InTheMoneyStocks
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