US bombs Iran and blocks their oil — load up on energy stocks
Created
Thesis
Oil prices have surged over 5% to two-week highs after the US military launched multiple rounds of strikes against Iran and revoked waivers that allowed Iran to sell oil. The Strait of Hormuz is now at risk, which could choke off global energy supplies. Historically, when military conflict restricts oil supply, the price of crude spikes, and massive integrated oil companies like ExxonMobil capture enormous profit margins as the underlying commodity becomes more valuable.
Strategy approach
Create a momentum strategy for XLE (Energy Sector ETF) on a daily timeframe. Enter long when front-month crude oil futures (CL=F) make a 10-day high and XLE closes green. Exit when CL=F drops 5% from its recent peak, or hold for a maximum of 15 trading days.
Markets and timeframes
What this public preview can establish
- The thesis and strategy approach describe a market view. They do not show whether an entry or exit condition is currently met.
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