This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Covestor: Why I'm Bullish on Oil

By Sean Hannon, CFA, CFP, of EPIC Advisors from

A concept I often discuss is how the primary trend of a market influences stock prices. If the primary trend is bearish, we should expect prices to cascade lower. When indices around the globe crashed to synchronized lows in November 2007, this served as confirmation that the primary trend was bearish.

As the rally from these lows has faded, some indices have broken to new lows (i.e., CAC 40 and Dow Transports) while others have refused to confirm these lows. Despite the terrible economic data and lack of clarity about how companies will navigate uncharted economic waters, the Nasdaq and Wilshire 5000 remain moe than 12% above the November lows and the S&P 500 is 10% above its November low.

While the possibility of a major selloff driving these markets lower remains, the large spread some indices enjoy between current stock prices and prior lows raises the possibility of a bullish non-confirmation. If the strong indices can remain above the November lows and rally to a price that surpasses the January peak, the trend will begin turning bullish.

At this point, I believe there is an excellent chance such bullish action will occur. If I am correct in assuming that markets will head higher over the coming week and turn the primary trend bullish, the recession could end within six to nine months.

As the recession ends and global growth begins accelerating, we should see inflation return and hard assets outperform. Such an expectation is the basis of this week's technical trade in my newsletter EPIC Insights.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
USO $18.10 0.00%
AAPL $128.46 0.00%
FB $78.97 0.00%
GOOG $558.40 0.00%
TSLA $203.34 0.00%


DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs