Oil stocks in the performance of crude oil and oil ETF over the next several years - but energy Juniors will be better than both.
The market is now to create a great starting point for junior oil!
What we have here an explosion BULLISH ratio of West Texas Crude against large oil reserves.
In technical language, this structure has recently erupted in the multi-year reverse head and shoulders model (or cup and saucer, depending on your interpretation) painting at a minimum target of 0.14.
What is soon clear is that when oil stocks have underperformed in respect of crude oil, the general direction of the stock market was less!
This in itself is not secret, as we all were disappointed by the lack of progress in oil stocks, compared with the underlying goods. But what is presentiment, perhaps, is that the relative responsibilities is destined to continue for much longer - probably years. And the withdrawal of Dow remain in the expanded Secular Bear Market. In confirmation of what we talked about that stock returns will be low, if not negative for the next 5-10 years!
The main issue:
Now that we painted doom and gloom, there is light at the end of the tunnel.
Oil stocks will surpass crude oil - Dow will also rebound. Now we are approaching excellent starting point for oil shares.
Keep in mind, we do not think that oil reserves will be shown negative indicators over the next 5-10 years, but we believe they will lag Crude oil itself. Superior returns can be captured by small energy producers and researchers who will benefit from market trends, as well as specific company news, such as the promising results of drilling. Oil stocks place to set the time and now!
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