Do You Own Enough Energy?

JC Parets
July 31, 2023

The fact that Energy hasn't even broken out yet really stands out to me.

Energy, and commodities in general, have been left for dead this year.

Investors have forgotten about that third asset class: Commodities.

It's not just stocks and bonds kids.

There are Commodities too!

Here's the Energy Sector Index, flat over the past 15 years.

It still hasn't even broken out:

The way I learned it was that, "The Bigger the base, the higher in Space". 

Meaning, the longer a range takes to break out, the higher and longer the eventual trend is likely to last.

In this case of Energy, we're looking at a monster bull market in everything else, while $XLE has continued to just grind sideways.

If this thing can get going, I think it has legs.

And what about Crude Oil at $250?

How many of you have that in your BINGO card?

Here's what the Bond market is pricing in for Inflation. There are a lot of ways to measure this, but a simple ratio between the Inflation-Protected Treasuries and Nominal Yielding Treasuries will show you exactly that.

There's no reason to over-complicate it.

I overlaid Crude Oil so you can see that they dance together:

The bottom line this: Investors, particularly in America, do not have exposure to Energy and other Natural Resources.

The S&P500 is ONLY 4% Energy. It's 2% Materials.

The Nasdaq100 is 0% Energy. It's 0% Materials.

Investors don't own it.

I like that.

Here are 7 names that you need to know to profit in Energy in the back half of this year.

Check out the link here.

Then let me know what you think.

NOTE: We'll also be talking about this on Wednesday night during our LIVE Monthly Charts Strategy Session.

Premium Members make sure to Register Here.

And if you're not a Premium Member of ASC your life has gone horribly wrong ;)

Come join us.

JC

 

 

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