I've been stalking a tradable low in light crude oil for what seems like an eternity. But every time bulls stick their heads above water and crawl onto a rock, they're beaten like a baby seal. Here's how I think this might change.
I'm currently focused on the $29.25 to $29.55 area on crude, roughly $8.40 to $8.48 on the United States Oil Fund (USO). As long as the contract is trading beneath that area, the path of least resistance will remain unquestionably lower. However, if it can break above that zone and close there, we might find traders doing a 180 and immediately begin bidding prices up toward $34 and the declining 50-day simple moving average.
Given the poor price action in light crude oil and much of the energy sector, Hess (HES) did a fair job standing its ground Wednesday. The stock was upgraded by Goldman Sachs at the start of Wednesday's session, and that obviously gave the stock a lift at the open. Keep an eye on this stock the moment crude catches a bid, as all trading above $39 could set the stock on a path toward the mid-$40s.
Twitter (TWTR) reported earnings after Wednesday's close, and while the numbers were not particularly impressive (OK, they were crummy), the stock staged an impressive turnaround. My thought here is simple. If you're hell-bent on picking a bottom in TWTR, consider using Tuesday $14.31 low as your reference point. All trading under that level tells you buyers are still uninterested in the stock.
A better way to play the stock may be to wait for shares to trade (and close depending on your timeframe) above $15.55 to $15.70. All trading above that area would leave the current week's trading in the dust, and likely pave a way toward last Thursday's $17.20 swing high.
Any trading or volume profile related questions can be posted in the comments section below, emailed to me at email@example.com or posted to my twitter feed @ByrneRWS