Valero Energy Corp - VLO Quick Trade

I had a restful break from trading the last few days, and climbed back into my turret for the action today. Valero Energy Corp - VLO was my first target. As the bulltrader points out, energy ETFs have not been kind to the energy investor for the last few months. That’s why it’s advantageous being a trader. I like to track the OIH. I’ve mentioned a few other oil sector stocks on my watch list including CLB, MRO, SWN, COG, ECA and VLO.

Valero set up a bull flag on the daily chart that I spotted last night. One economic number I do pay attention to is the Oil reserves number which usually comes out an hour after the stock market begins trading. This is around mid-morning each Wednesday. It moves these oil service sector stocks every time, so it’s one to be aware of.

VLO was slowly trading in a choppy pattern for the first hour. I like to take the high over the 30-minute high if a stock is showing momentum. When the oil inventory number hit, I noticed the OIH start shooting up. My Valero alarm triggered, and I executed a buy at 52.99. I’ll run a tight stop loss on a trade like this. The purpose of it is to break out. If it stalls, something is wrong. Get out. I’ll mentally set a stop, and monitor the stock. In the case of VLO, it acted as I wanted.

The plan was for a quick profit. Setting trailing bar stops works well for this. You can see on the chart where the stock was stopped using this method. A partial sell could have been planned, but with a fed meeting later in the day, I chose to sell the whole lot.