Red-Hot Resources

"Luck is not chance, it’s toil; fortune’s expensive smile is earned.”

Saturday, January 12, 2008

Keep Your Eye on the XLE

No sooner do I start tooting my horn about how well your stocks are holding up yesterday than the broad indices fall off a cliff and EVERYBODY goes down. However, your portfolios didn't suffer nearly as bad as some, (like those poor bastards in tech, for example. Ouch!). So if we have a pullback for a bit as things shake out, so what? That just means better buying opportunities, which is what I've been looking for since Christmas.

Let's take the energy complex as an example. The XLE, a broad index of oil industry stocks, is trying to find support. If it breaks support, it could tumble lower. However, it also looks like a set-up for a move much higher. I think a bottom could be closer than a lot of people want to believe right now. That's when bottoms come – when everyone is looking for the exits.

I'll keep my eye on the XLE, and I'll keep you posted.


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