Buy Alert: March 2, 2015
Buy Alert: March 2, 2015
Option Strategy:
Buy EOG Resources (EOG) April 17, 2015 $95.00 calls for $1.30 or better.
Commodity Outlook: Oil
After slumping to $48 late last week, WTI crude bulls are pushing the commodity back above $50 in today’s trading session.
While I am still not convinced crude oil has completely bottomed, there’s a number of top-tier oil producing names that very likely have.
Here’s a leading North American shale producer that’s presenting a fantastic low risk trading opportunity…
Resource Company: EOG Resources (EOG)
EOG is a $49 billion market cap, independent shale driller that is positioned perfectly for an oil rebound.
Due to its low cost areas of operation, EOG is still producing oil at a profit- despite the fact the commodity is trading near 6-year lows.
In fact, in EOG’s recently released Q4 earnings report, they announced a $444 million profit, or $0.81 per share. While the results were below analyst expectations and weaker than year-ago earnings, it’s proof the company holds prime low-cost acreage.
And listen to this…
With EOG trading near the bottom of a technical range, there’s a prime low-risk trading opportunity in the name right now. It’s highly likely EOG rebounds to higher prices in coming weeks as bullish traders react to this important level.
But before I show you a chart, here are the options we’re trading…
Buy the EOG April 17, 2015 $95.00 calls for $1.30 or better.
The current bid/ask spread for this contract is $1.13/$1.17.
Do not pay more than $1.30!
Our official entry price for performance tracking is $1.17. Your price may be higher or lower.
Exit Strategy:
As you can see, EOG is currently trading near the bottom of a trading range (blue lines). It’s very likely bulls push EOG back to the top of the range in coming weeks.
Remember, we want EOG to trade higher. Our first profit target is $95 and our second is at $97.
The risk control price for this trade is $86.00. If EOG trades below that level, conservative investors should consider closing this trade to preserve capital.
Category: Commodity Trading
