Energy Stocks Dropping Fast in August

While most stocks have been riding a bull market higher this year, the energy sector has been moving lower, but the drop has accelerated since August 1, as demonstrated by the drop in ERX, a leveraged 3x ETF directly tied to energy stocks like Exxon, Chevron, and ConocoPhillips. ERX closed today at $21.57, about half what it was on January 1 and 22% below the price on August 1.

As shown in the chart below, ERX just hit its’ bottom support level and is now well below the bottom Bollinger Band, so from a purely technical perspective, it seems likely to bounce soon, but other factors might be preventing that.… [Continue reading...]