Market. He thinks the market made a change last year benefitting the pro-growth sector, while energy is still lagging behind. Utilities on the S&P500 have fallen since December. He says inflation is causing this sector to fall making it interesting again. If inflation really starts to run away Central Banks may not be able raise interest rates fast enough to keep up and this could be the concern for the sector.
He believes this natural gas based energy stock is technically showing an upward bar recently on the weekly chart. This suggests a building point could be forming. If it falls below $19, he thinks this move could be a fake-out. He would expect resistance at $25 and then $33. He thinks there is a good risk-reward here. (Analysts’ price target is $27 )
Although it is producing more oil today, it is trading near five year lows, he says. The trend has been down for several years, but the short-term bullish retracement allows an opportunity to place a stop around $1.98. It is the seasonal strong period and we should see resistance around $2.39. He would like to see this stock really accelerate with the recent rally in oil prices.