Here is a trading idea on Phillips 66 (PSX) (October 22, 2012)
XOIL.X PSX
I’m DanFitzpatrick at StockMarketMentor.com on Monday, October 22nd. I want a look at oil real quick here. You can see it’s in a bit of a volatility squeeze with the Bollinger Bands pretty tight here, you know tight for oil anyway. They’re a little bit tighter here and you saw what happened. You didn’t really get much of a break out to the upside, moved up a couple days, but then the break was to the downside. I really, in light of that, you know I can’t tell you which way oil’s going to go going forward, but I do know this; a lot of the energy names aren’t looking particularly enticing, but one is and that’s what I wanted to show you. Phillips 66 ( $PSX Phillips 66 ), refiner, this is a spin-off from Conoco Phillips ( $COP ConocoPhillips ). Quite a while ago like, I know back here. So since that time you know we started at Stock Market Mentor, we really started trading this thing or buying it I should say, when it started this IPO, when it conformed to this IPO strategy that I have. Bottom line is you buy it when it starts printing new highs after what I call the reaction or the enthusiasm high the first print goes up to typically here, it actually opened up and then started trading down by the time the stock starts trading decisively back above this level, well, all the suckers have been cleared out and the only folks that are left are winners and so there’s no overhead pressure other than just the profit taking from time to time which we see here, here sideways consolidation here, and now finally we’ve got this trickle downward for the last month or so; so now we’re at a pretty good buy point yet again. So my sense on Phillips ( $PSX Phillips 66 ) is if you’re looking for an energy name that has some upside potential look at Phillips 66 ( $PSX Phillips 66 ). Just keep a, you know I wouldn’t really say a tight position stop because this last low here at $42.45 on the 12th you can see that on the upper left part of the screen there, that’s your real support, so if you were to keep a stop here, just below the 50-day moving average, well like one $1.00 below that is more support, so you can get stopped out and then a dollar later if that, the stock bounces and you’re kind of thinking, well stops don’t work. Rather than doing that I would suggest taking a small initial position and once the stock starts rewarding, in other words starts to move higher, then you can build on it from there; this keeps you from having to pick a precise bottom, a precise low and instead just enables you to get in when the stocks been consolidating, drifting down to a pretty good buy point with some upside potential. So if the stock continues to move higher, and I think it will. It’s not as if you’re going to get it all, you’re not. By definition you’re starting a small position but at least then you’re acting more like a risk manager as opposed to a trader. So anyway, try that on Phillips 66 ( $PSX Phillips 66 ). Members, Strategy Session, got a lot to talk about. Also one last thing, checkout Option Market Mentor, this is my new website, we focus specifically on options; you can get in for the first month at an introductory price of $7.77 and it’s refundable, okay, so I don’t really know why you’re not over there if you’re not already. For $7.77, and again we’ll give you your money back if you don’t like it okay, so want you to get over there and do that today. I’m Dan Fitzpatrick and I’ll see you right back here with another free video tomorrow. Free Chart