I Was Right – Oil is at $99.50 Per Barrel

Dear Profit Takeover reader,

I predicted oil would reach $100 per barrel within the next month – and it’s only $0.50 away.

Energy and mining names are going to be at the top of my list for the next several months…

Here are some energy names I am watching:

1. United States Oil ETF (NYSEARCA: USO)

USO just blew higher to $66.88, but is down as I am writing this…

I am going to keep a lookout here as oil prices increase.

2. BP plc (NYSE: BP)

BP is currently down because of its proximity to Russia and the potential exposure to war or pre-war conflict and we will likely see a rough couple of days here.

3. Exxon Mobil Corp (NYSE: XOM)

While Russia exposure is making BP suffer, XOM is looking strong – since it’s based in the USA.

I am looking to get long calls in XOM…

The current price is an absolute gift to set up long calls in the dip because I like XOM going higher.

4. CBOE Crude Oil Volatility Index (INDEXCBOE: OVX)

OVX has reached a 2-month high and a year-high, but it’s still not quite as good as it was back in November 2020.

From Yahoo Finance

I am expecting a secondary pop here.

A Bear Market Doesn’t Mean All Stocks Are Bearish

We are seeing full backwardation in VIX futures as VanEck Russia ETF (BATS: RSX) – the U.S.’s first ETF focused on Russia – has placed a hold on the key gas pipeline into Europe.

But you can still make a lot of money with volatility in a bear market.

A lot of stocks drop, but not all of them will…

The price of oil is inversely correlated with the market – and so are oil’s double first cousins – mining, natural gas, and steel.

So as the market goes down, stocks in these sectors will rise.

And Russia’s potential invasion of Ukraine will only intensify this bullish explosion.

Heading into a volatile March, I will continue finding inexpensive vol plays in energy with the Profit Revolution.

Here’s what members are saying:

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Hope to see you there.

Until next time,

Mark Sebastian
Founder, Profit Takeover

Volatility Forecast

Volatility is going to be high this week.

My light has been green for about a week now – not a good sign of what’s to come.

The VIX futures curve is in backwardation. Tensions are mounting between Russia and Ukraine. High beta is getting destroyed. And we’re starting to see cracks in the megacaps, which have been the only names holding the market above water.

This week could be key for the rest of the quarter in terms of how the market stacks up.

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WATCHLIST

1. Vale SA (NYSE:VALE)

Metals and mining are like a cousin of energy – and with energy prices rising, I think this Brazilian company is about to break back above $17 a share…

Making VALE prime for a long trade.

2. Exxon Mobil Corp. (NYSE:XOM)

With oil on the move, it’s probably time to look at long XOM again for a move above $80 a share.

3. Verizon Communications Inc. (NYSE:VZ)

With a war on the horizon, investors are rushing to “safety stocks” – and that means a name like VZ, which pays a nice dividend and has a pretty consistent stream of income, is likely to pay off.

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