Friday, November 20, 2009

OIH may walk the Plank

Looking over some charts this evening and noticing that one particular sector looks as if it is about to hit rough waters. Guess which one? Is the suspense getting to you? The Sector is OIL and it's service providers. When you take a look at OIH and stocks that comprise this ETF you will notice that many of these charts are displaying a topping effect, such as an head and shoulders top or another topping formation known as the double top. They say one can learn from the past and when you take a look at the chart of the OIH, you can see that we have visited this once before and the pattern failed to work it way to completion, or as I like to call it a Head fake. (Sorry for the pun.) Either way the difference between failure and success is the sector as a whole is setting up versus a few when this pattern last occurred. We will see if this pattern will be successful in meeting it price objective of $98.00 from it's current price of $117.10.. So get out the swords and tell this stock that it is time for it to walk the plank, for it has an appointment with Davy Jones' Locker. Take all ye can and give nothing back.

No comments: