For years Europe has been on the cutting edge of green innovation. Well, with big plans such as green energy, if you don’t move quickly things can happen that make those plans backfire and have global repercussions.
The newest ripple of confusion caused by the market super cycle has made its way to commodities, specifically oil and energy.
Now that Russia closed the tap on natural gas to Europe, the realization of those big plans is in question. Supply chain issues were already a problem, but now these issues are straining the energy market. That’s because they get roughly 40% of their natural gas for cooking and heating their homes from Russia.
On top of that, we have the Fed coming in and saying they are tired of the high oil prices. It seems as though Powell’s jawboning may be helping to knock big oil down a peg as a means of helping fight inflation.
No surprise, there is a lot of confusion right now in the market. People don’t know where to put their money.
However, you are among the few and the proud who can recognize the active trading zone created by all of this turmoil. So this moment is certainly an opportunity for you.
Bearish signals are rolling down the hill
Let’s break down something from my Night Traders here to see where the market sentiment falls today.
Now I could hand this chart to a toddler and they could tell you that the markets are looking bearish.
We had 157 bearish signals from my Night Trader service. Leaders in the carnage were the technology, financials, discretionary and energy sectors.
Energy had 18 of those signals still showing me that it is a sector that stands to make us some money on the downside. There are sectors that had more bearish signals and that’s okay. There are trades to be made in every single sector that can put money in your pocket but, these signals are not a stand-alone indicator and energy has its back against the wall thanks to the global climate and technical analysis of the sector.
A Closer Look at Sector Performance
Listen to me carefully, we WILL be going bullish on these energy opportunities as soon as we are afforded the opportunity. Right now as I say with gold, silver and everything else in this market, show me the trend and I will show you the trade.
Today and for the foreseeable future the trend we need to be watching is in the energy providers, oil production companies and even some of the big energy companies like BKR, SLB, HAL, etc.
I asked Brandon how we get to these trades and dial in on the energy sector.
We look at the Skittles chart of course.
This chart is an integral part of how I trade the markets. This is the heat map that I use to guide my ETF purchases. This chart also showed us the cracks in the energy sector that we are starting to take advantage of in my Night Trader portfolio.
The Year to date on the energy sectors has them up nearly 20% on average. Recently we have been seeing energy start to have bigger down days than those in the rest of the group. Whenever we start to see something at the top of the list start to get into these situations it’s a clear indicator of a trend that is shifting.
When those trends shift it causes confusion. Confusion yields opportunity to the well informed to trade a market hotspot.
Every single day my Night Traders and I look at this exact chart and compare it to my Bull VS. Bear chart above and where we find the matches in market confusion is where we get to work at 3:30.
We dig into the data analysis and with the power of the technicals we find the hottest trade to be in at that moment.
How we are profiting from the Energy Hot Spot
Yesterday we looked at all of this data with my Night Traders. We ended up putting on three trades in our energy action plan. One is down about 3% but it’s only been a day… the other two, well, one is ALREADY up 28% and the other is just over 16%…
IN A SINGLE DAY.
Now I don’t know about you but to me that seems like a good days work. We are going to continue to put new trades into this portfolio every single week.
All you have to do is watch the trend in the energy market. You see the trend in the sector and I will take you to the trade in the energy companies.
I’m showing my Night Traders exactly what to put in their technical tool box, exactly how to sharpen those tools, and the best way to implement them.
Don’t be the person who loses out on a profitable summer because you have the blinders on. This is only a taste of what my Night Traders get week after week. Find out how you can join the Night Trader crew before the next trade leaves you behind.
Quantitative Specialist, Penny Hawk
July 12 2022