The FRED Report ( www.thefredreport.com) has a few seasonal trades that we generally monitor. One of these is to buy oil stocks in mid to late June for a summer rally. This year, for various reasons, the rally did not start in June -- but can it start now that the Gulf oil spill is being contained? We show below charts of the United States Oil Fund (USO), an ETF that tracks crude oil, and the United States Natural Gas Fund (UNG), an ETF that tracks natural gas. Readers can see that Oil has been in a basing pattern and may be picking up. Natural Gas has also started to pick up. These charts suggest to me a rally in the petroleum complex could occur through the end of summer. How can we capitalize on this rally? There are many oil stocks as well as ETF's we can use. First, we cover a couple of ETFs. For big integrated oil stocks, our favorite ETF is the Select Sector Energy SPDR (XLE). This exchange-traded fund is our favorite way to buy a diversified basket of large-cap oil stocks, as it is the most liquid of the oil stock ETFs. For oil services -- we like the OIH, and also the IEZ. Of the last two, the IEZ is a little stronger on a technical basis, but also a little less liquid and therefore more risky. Second, we cover a couple of stocks for equity investors. The first one (and the most difficult!) is BP (BP), where we have had a lot of questions. We show below a weekly chart of BP, and contrast it with Chevron (CVX). Because of the spill in the Gulf, BP has dropped significantly in price. Such a price drop is usually not a plus for technicians, who generally try to buy strength and not weakness. Investors should ask themselves if they are willing to assume the risk of owning BP in the face of lawsuits, adverse news, and such that may occur in the aftermath of the spill. While nobody knows for sure what will happen, it seems a better, less risky bet to pick something like Chevron, which is unconnected to the spill.