Exxon Mobil Corporation explores for and produces crude oil and natural gas in the United States, Canada/South America, Europe, Africa, Asia, and Australia/Oceania. It also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and specialty products; and transports and sells crude oil, natural gas, and petroleum products. As of December 31, 2015, the company had approximately 35,909 gross and 30,114 net operated wells.
Take a look at the 1-year chart of Exxon (NYSE: XOM) below with my added notations:
Over the past four months, XOM has formed a key level of resistance to watch at the $88 (red) mark. The stock tested that level once in August, September and October, and a couple more times in November. A strong close above that $88 level should lead to higher prices.
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The Tale of the Tape: XOM has a key level of resistance at $88. A long trade could be entered on a break through that level. However, if you are bearish on the stock, a short trade could be made on any rallies up to $88.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach