As a trader, it’s important to know how to adapt. That’s why it’s important to watch all stocks — including oil stocks
That means that you need to meet the market where it is rather than trying to bend it to your will. And sometimes, you may need to step outside of your comfort zone to take advantage of promising opportunities.
Take, for example, energy stocks. Personally, I hate trading them … they tend to move slow and be choppier than I like. But with oil prices on the rise this year, it’s at least worth watching a few stocks to see how they perform.
After all, as I say to my students, I like to act like a retired trader. A trade has to really be worth my time and good enough to take me out of my figurative retirement.
So even though they’re not my preference, I’m keeping an eye on a few particular oil stocks — you just never know where the next great trading opportunity will be…
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Why Watch Oil Stocks?
Even though I don’t like energy stocks, plenty of traders do. After all, commodities like oil are always in demand, and they can show seasonal trends.
If you’re interested in oil stocks, now is a particularly interesting time to keep tabs on them … oil prices are on the rise.
While this makes for unhappy news and high prices at the gas pump, it could equal opportunities for traders.
But if you want to seek out trading opportunities, how do you find the best oil stocks to watch?
By making and maintaining a strong watchlist, of course.
A watchlist is a short list of stocks that you maintain and keep track of to see if they fit your criteria for potential trades. You could consider it your personal trading garden, full of stock-plants that you’re weeding, watering, and watching to see what grows.
Are You Watching These 3 Oil Stocks?
Excited about oil stocks? Here are three you may want to consider monitoring:
Earthstone Energy (NYSE: ESTE)
A relatively small company with 65 employees and a market cap of $176.64 million, Earthstone Energy, Inc. develops and operates properties dealing in oil and gas in West and South Texas.
In 2019, they anticipate higher-than-usual cash expenditures as they expand their production … but overall, the financials are solid.
The money they spend in 2019 could poise the company for further growth in 2020. And there could be sympathy plays, as Callon Petroleum Company recently closed a divestment deal in the same region that has seemingly acted as a positive catalyst, bringing the stock price up.
Here’s the ESTE 1-year chart:
Currently, shares of ESTE trade for about $6.12, with a 52-week high of $11 and a 52-week low of $4.21.
Helix Energy (NYSE: HLX)
This energy company is headquartered in Houston, but has operations in Brazil, Luxembourg, the UK, and Singapore, and has about 1,500 employees. With a market cap of 1.28 billion, it’s not massive, but it’s pretty respectable in size and scale.
Helix has a few different company segments, and between the segments, they get involved in all kinds of energy-related disciplines, such as:
- Rigless offshore well intervention
- Supplying subsea engineering services
- Operating a floating production vessel that gives operators access to their vessel in the case of well control incidents
Take a look at the HLX 1-year chart:
For the first three quarters of 2018, their earnings exceeded analyst expectations, but they fell short in the fourth quarter.
But the stock has good volume and has been steadily gaining in the past month. It currently trades around $8.77 per share, with a 52-week high of $10.89 and a 52-week low of $5.05.
Torchlight Energy Resources (NASDAQ: TRCH)
Headquartered in Plano, Texas, Torchlight Energy Resources is a small company, with a market cap of just $102.11 million.
They take part in the acquisition and development of oil and natural gas properties, focusing on drilling and work programs. They’re currently involved in a variety of oil/gas projects, including the Orogrande project in Texas and the Hunton Wells, in partnership with Husky Ventures in Oklahoma.
But what’s more interesting (to me anyway): TRCH has been big gainer recently, with shares rising from below $1 to currently around $1.32 in the past few weeks. Could this company be on the rise? TRCH has a 52-week high of $1.98 and a 52-week low of $0.53.
Check out the TRCH 1-year chart:
Get My No-Fee Stock Watchlist
Interested in staying up to date on all the stocks I’m watching? You can join the Tim Sykes Watchlist … and there’s no charge!
Every week, I research stocks and send out three that I’m personally watching and considering moving on. I’ve performed detailed research on every company on the list, and often enough, you’ll see these picks pop up on my publicly logged trades on Profit.ly.
What are you waiting for? Sign up now!
Sometimes, it can be good to step out of your trading comfort zone. It can take you down unexpected paths that can potentially lead to rewarding opportunities.
But remember to always be calculated in your approach to trading — especially when trying out new strategies or trading in different sectors.
Make educated decisions and build a strong watchlist. Perform detailed fundamental and technical research on any stock you’re considering. No trade will ever be a sure thing, but careful research and watchful waiting can help you make more intelligent decisions.
The market is constantly changing. To stay adaptable, you need a strong foundation of knowledge about trading, market mechanics, and what to look for in stock patterns.
If you’re trying to learn as you go, chances are you’ll make mistakes — and lose money along the way.
In my Trading Challenge, I provide traders with the education I wish I’d had when I was starting out in the stock market. You can learn from both my successes … and my failures.
My goal? To help you become a self-sufficient trader. In the Challenge, you’ll learn things like how to recognize and move on patterns, as well as things like how to perform detailed technical and fundamental analysis.
Remember: Knowledge is power, especially when it comes to trading!
Are you ready to take a proactive step toward becoming a self-sufficient trader? Apply for the Trading Challenge today.
How do you trade oil stocks? Are any of these oil stocks on your watchlist? If so, how do you feel about their potential? Leave me a comment and tell me your thoughts!