Middle East attacks halted but oil still spiking — momentum play on energy and p
Thesis
News that the US and Iran are stepping back from direct attacks removes the worst-case scenario for the region, but the immediate threat to oil tankers in the Strait of Hormuz is still pushing oil prices higher. As Wall Street rotates out of tech into other sectors, energy stands to benefit from this inflationary pressure. The massive $5.5 billion pipeline acquisition by Williams Cos. shows that major financial players are aggressively betting on the long-term value of natural gas and oil transportation, making pipeline operators highly attractive right now.
Strategy approach
Build a rule-based strategy that enters long WMB and XLE on D1 when front-month WTI crude oil futures (CL1) close up >2% on the day. Exit when CL1 closes down >2% from its 10-day high, or after a 21-day max hold. Use a 6% trailing stop.