We have started recommending some energy names in recent days as we think they can be the market leaders in the fourth quarter, but in this weak tape, we find some readers pushing back. It is tough to embrace a long idea when the Dow Jones is off 300 points. Nevertheless, we have another energy name to put on your shopping list: WEC Energy (WEC).
WEC peaked in February around $56 and turned down to $45 (see the chart above). Note the heavy volume at the July low as someone sold aggressively and someone else bought. Since that summer, low prices have improved and the On-Balance Volume (OBV) line has been rising and confirming this early bull move.
This second chart, above, shows us a stock we want to be involved with, boasting a nice uptrend with a rising OBV line. With this longer-term perspective, the price action this year looks like a correction in an ongoing bull.
What's our strategy? Traders could be patient and look to buy a shallow dip in WEC or go long on a close above $52. Pick a style that suits your investment personality.