Consumers heading to the gas pump Tuesday are getting worried as the nearby futures contract jumped higher on the heels of news that Saudi Arabia and Russia are extending their supply cuts to the end of the calendar year.
Let's check out the charts of the SPDR Energy Select Sector ETF ( XLE) , which is an Action Alerts PLUS portfolio holding.
In this daily bar chart of XLE, below, I can see that the stock has sprinted higher in recent sessions. XLE trades above the rising 50-day moving average line and above the cresting 200-day line. The 50-day line has crossed above the 200-day line for a bullish golden cross buy signal.
The On-Balance-Volume (OBV) line has been working higher since March and tends to confirm the price gains we have seen. The Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment above the zero line. 
In the weekly Japanese candlestick chart of XLE, below, I can see a potentially large bullish triangle formation. Prices have been stalled in the $90-$95 area for about a year while we can see higher lows from June 2022.
The trading volume has been weakening during this triangle pattern and that is typical. The weekly OBV line shows us a three-year positive trend. The MACD oscillator is bullish.
In this daily Point and Figure chart of the XLE, below, I can see that prices have reached a price target of $91.
In this weekly Point and Figure chart of XLE, below, I see the same $91 price target.
Bottom-line strategy: Supply and demand. The supply of crude oil is being curtailed because the demand for the black gold is waning. A timing tool I use (www.pfr.com) has a large-scale "trend change" anticipated for the price of crude oil on or about September 15. I have no fixed opinion on the direction of crude oil but the risk is that the current rally could reverse direction. Keeping that in mind I would not jump into the XLE at this point in time.
(XLE is a holding in TheStreet's Action Alerts PLUS portfolio. Want to be alerted before the portfolio buys or sells these stocks? Learn more now.)
