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With all the hype about oil and all of the stocks so far stretched from the 200 and 50s, would you recommend jumping on board now and average down when pullback to at least the 50 week? Or wait to put initial money back into oil when pullback occurs? I'm talking about stocks like BP, OXY, TOT and even USO.

So, based on that, if you are keeping them, you could put money in when the pullback occurs, as long as the fundamentals are still behaving!

If you've got nice profits, there's no need to keep BP/TOT/USO, etc. I didn't recommend OXY. Someone else likely suggested that one to him. Money should go into official LI recommendations. And lots of spare cash be held, otherwise.

Do you think oil is soon headed in into a major downward spin?

Bekka, no one can know for sure and if they say they can...they're lying. But we can always know when the risks are high/probable for a sizable correction, which is when the price gets extended far away/above its major moving averages. Look at pretty much every time this happens...what follows? Therefore, we know there's a HUGE likelihood of a massive pullback/correction. We also know that the RSI is diverging lower and the MACD is flatting out, which is its own form of divergence from a rising oil price. So that shows the upward momentum could be slowing, which is temporarily bearish. We also know that the price of oil is now in a common resistance zone and its towards the top of that zone. So all of these things raise the odds, big-time, of oil having a huge pullback. The reason would think otherwise is because they listen to the news and get caught up in the hype. Its why we use measurable metrics and don't let non-measurable things be our guide.

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