Sell Oil, Buy Water

By The Wall Street Fox Wednesday, March 23, 2016
Why buy oil? Supply glut. Tepid growth. Rapid innovation in energy efficiency, renewables, green cars etc. Even the Rockefeller's divested oil from their investments, and today they harshly criticized Exxon Mobil for its alleged campaign against climate change dating back to the 1980's. Think about that. The family that started what is now Exxon Mobil scathingly attacked the company for its anti environmental actions.

Why buy water? Survival.

If we go out decades, would it be far fetched to see oil nearly non existent/worthless? Would water be a more valuable resource?

Two charts below to pair trade this theme short term. Sell Chesapeake Energy, Buy Primo Water.

Sell CHK. Clear downtrend. Decisively rejected at falling resistance. New lows seem inevitable.

Buy PRMW. PRMW keeps punching $9.50 resistance level. Few more punches should knock it out and continue higher. Primo sells purified water. They have dispensers at thousands of grocery stores, where customer will fill up 5 gallon jugs of water, or regular gallons. The local K-12 schools near me have discovered an alarmingly high level of lead in their water (old infrastructure/pipes) surprise, I've seen the Primo Water dispenser busier than usual on past few trips to grocery store due to the lead scare. This is happening (on a much, much worse scale) in Flint, Michigan. 

The Wall Street Fox

The Wall Street Fox utilizes fundamental and technical analysis to generate investment ideas. TWSF holds a MBA, and is currently preparing for the Chartered Market Technician (CMT) designation.

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