Two Beaten Up Markets That Deserve Your Attention

Risk is on! Markets rallied and the US dollar was crushed after Janet Yellen’s comments awoke US markets from it’s week long low volume slumber. While there’s lots of interesting stocks out there to choose from, I want to highlight two commodities: $USO and $UNG both of which are at interesting prior inflection points.

USO_3_29

$USO went on an incredible run from late February and all throughout March rallying from sub $8 prices up to the mid $10’s. At around a 30% rise in the context of a long-term downtrend it’s not too surprising we have seen oil retrace lower over the past week.

But now that it’s retraced about 10% of that 30% move it’s time to pay attention to it once again as it re-tests prior support at roughly $9.60. Bulls are going to want to make a stand here to prevent a further slide to YTD lows.

UNG_3_29

$UNG is even more interesting to me as this is an extremely beaten down market that is looking like it wants to break out from it’s recent downtrend. We tried shorting this last Wednesday off that bearish engulfing bar and it only took us two days to realize the market had no intention on re-testing those March lows. We’ve covered that short for a loss and we’re watching this duel trend line breakout as a potential signal to get long.

Keep an eye on this area and the close today for clues.

 

Enjoy what you read? Share it below and be sure to tag @thetraderisk.

Find similar content on the following:
Posted in ,
Tagged with

Evan Medeiros

Evan is the founder of the Trade Risk. With 20+ years of coding experience and a B.S. in computer science, Evan brings a systematic discipline to investing in the stock market.

Don't miss out on more educational articles just like this!

Please enter your name.
Please enter a valid email address.
Something went wrong. Please check your entries and try again.

Leave a Comment