Iran war disruption sends oil prices surging — ride the momentum on Occidental
Thesis
When war or conflict disrupts oil supply, the price of crude spikes — and oil producers reap the benefits. Occidental is directly seeing higher prices for its oil this quarter because of the Iran situation. If tensions remain elevated, these companies will continue to cash in on elevated prices, making their stocks attractive as a momentum play. This is a straightforward way to trade geopolitical fear: own the companies selling the commodity everyone is suddenly worried about.
Strategy approach
Build a momentum strategy on OXY and XOM using D1 timeframe. Enter long when front-month crude oil futures (CL=F) make a new 20-day high and OXY closes up >2% on volume above its 20-day average. Exit on a 7% trailing stop or if oil closes below its 10-day low. Max hold 21 days.