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5 Call Contenders: Oil

Watch these names for call options opportunities


As I was using my Power Stocks scanning program to take a look at the market, oil stocks caught my attention—and it looks like I’m not alone, given yesterday’s and today’s Trade of the Day stocks. Several names in this area had all of the qualities I look for in a call option—the potential for a big move up (volatility) based on technicals and past activity in the stock, and good liquidity. All of these are names you’ll recognize, and for good reason—options which do not have liquidity may trap you into a position, or prevent you from taking a large enough position to make the transaction worthwhile.

I’ll leave it up to you to decide which strike price and month are appropriate for your trading style, but be sure to give yourself enough time to be right. I’ve also included the support and volatility levels my scanner has detected for these stocks. An average volatility is considered to be 20.

  • Exxon Mobil (NYSE:XOM) was our Trade of the Day yesterday, and it has started its ascent, trading about a dollar above its $89 support. Volatility for this stock is low, at 10.
  • Occidental Petroleum (NYSE:OXY) is also trading at $90, well above support at $83. It has above-average volatility at 27.
  • Halliburton (NYSE:HAL) has support at $41, and is trading slightly above that at $43.56. Volatility for the stock is at 35, well above average. This means you can expect some wild price action, but the overall trend is bullish.
  • Schlumberger Ltd. (NYSE:SLB) is also on its way up, trading $2 above support at $77.04. The stock also has above-average volatility at $27.
  • Rowan Companies (NYSE:RDC) is another bullish name, but it’s sitting right around its $34 support right now. This could be the perfect opportunity to get in before the rally.

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