The Arctic blast that hit California, along with lower temperatures across the United States may have cooled off global warming conversations and heated up exchange traded fund (ETF) Energy Select Sector SPDR (XLE). With the colder weather moving in and uncertainty of oil output in the middle east, there may be an opportunity to profit if oil bounces back. Oil is at its lowest in 19 months, closing at $51.21 a barrel, for February delivery. OPEC will eventually cut the output by 107 million barrels per day, says Parmy Olson of Forbes, and in the meantime, oil reserves are limited and getting smaller. Emerging markets such as China and India are in greater need than ever before, for this commodity.

There may be an opportunity coming to profit if oil bounces back.  So, watch XLE and its 200-day moving average if you are interested in playing the oil rebound.


The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.