Forget Big Oil. Try Baby Oil instead…


If Friday gave you a headache, you’re not the only one…

I think most folks anticipated a drawdown considering the recent test of the downward trendline on the SPY, but that was a rough ride.

What does that mean for this week?

Shaky hands… volatility… focus on mid to large caps… commodities…

But I tell every trader this: Relax.

Take this time to strengthen long positions and keep an eye on the trend.

And right now, oil is getting bit of a lift…

Today we’re going to turn our attention to a ticker that’s known for running (and sounds similar to the image above): Houston American Energy Corporation (HUSA):

It feels strange doing this, but we’re checking out the daily chart.

I played with the time frames quite a bit and found that for this stock’s personality, the daily backtested more accurately.

Let’s dig in.

The stock has climbed above all major areas of Resistance in the last week.

Frankly, the only real areas to be aware of are the sub-$6.00 mark (red arrow) and — if you are exceptionally bullish — the previous run’s high at ~$8.60.

Master Support is in the range of $3.15-$3.70.

Speaking of the last climb, take a look at the green arrow pointing to the green column.

This is a signal that I use showing the bullish 8/13ema crossover. It’s not a beacon to immediately go long, but a signal.

And that’s playing out again as of Wednesday…

However, Chris Hood’s Squeeze 4-Pack did give me a signal to go “Long” prior to this under the purple candlestick.

(Purple candlesticks tell us higher prices are expected within 3-5 bars.)

On the lower chart, that same indicator (second one down) shows a slight loss of momentum with the 5-period oscillator printing dark green, although the higher periods are still bright green…

Still, I wouldn’t be too concerned here with the composite Stochastic line moving higher as noted by the black dotted arrow…

Looking at the Volume, HUSA has had numerous days where trading has broken above the average…

This is one of those clues I’ve talked about in the past.

Aiding the bulls is the next chart down of the Short Volume which has been on a steady decline.

Expect volatility here and watch for a potential run…

Keep moving,

(Disclosure: I hold no position in HUSA, but intend to initiate a position in the next 30 days.)

This material is not an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Any performance results discussed herein represent past performance, not a guarantee of future performance, and are not indicative of any specific investment. Due to the timing of information presented, investment performance may be adjusted after the publication of this report. There can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this communication will be profitable, equal any corresponding indicated historical performance levels or be suitable for your portfolio.

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