BLACK GOLD

Here we go again, folks talking about the demise of oil as we enter the end of summer driving season, find a dearth of hurricanes to the delight of the insurance companies, and a brand new discovery of more crude than we could possibly imagine right in our own backyard. Oh and most of the oil analysts on CNBC are bearish.

My guess, rude crude is about to reappear as the charts suggest a bottom as we sit at the 200 day SMA on the crude chart. That area provided a pretty good entry point in the past.

In addition, the OIH is showing a bullish divergence as the momentum indicators make some higher lows as the price makes a lower low. My plan is to enter in the low 130's with a stop under 129 as the risk reward looks plenty good back up to the 145 area.

OIH is one ETF that always seems to overshoot in both directions.