Oil: I Want This Done By the Book

With inventory out of the way for the week, crude oil is staging a fairly impressive rally into the New York lunch hour. 

No one can say for sure whether the worst is behind us with regard to the entire energy complex. But for a near-term trade the USO ETF, below on a zoomed-out hourly chart, shows a very steep falling channel now seeing price breach the resistance trendline upside. 

If USO can muster a close today above $9.50, I suspect it is another good opportunity for energy longs to enjoy a reprieve. 

Although that may seem like a quaint, simplistic approach, I would submit to you that there are so many convoluted, misguided opinions out there right now regarding crude and energy stocks that a "by the book" approach is likely even more correct here, according to game theory. 

As for energy stocks themselves, the exploration firms in the XOP ETF are outperforming. I will discuss that and some specific trade ideas for Members in my usual Midday Video, coming up