USO Followup, Great Odds
I first posted on the United States Oil Fund (USO) yesterday pointing out possible opportunity if the channel could be broken. Well, after today’s close on heavy volume concluding to the upside after trading down below $43, I am calling USO as a favorable odds buy. What I like about the last 3 days activity are the two heavy volume days that both closed towards the upper ends of their ranges. If you bought at $44.15 (or the closing price), and placed a stop at $43.65, you have a downward range of $.50 or just over 1%. On the upside, the stock may very well gap tomorrow (see my nice blue scribble of a bar) and could move up to $46ish. With a move to $46.15 you are getting 4 to 1 on your money, with only 1% risk. Outlook would be a day or two, and is simply a quick trade catching a rebound. Note also that the 10 day moving average is at about $46.
