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VLO and TSO: Long

July 17, 2008 1:41 AM

redarrowup.jpgBoth TSO and VLO, both refiners made important lows yesterday. This is likely because I think their margins are adversely affected by increases in oil, but not certain. This appears to be an inverse oil trade. At any rate, VLO is long above $29.70 and TSo is long above $16.11, IMO. If today’s highs do not clear first, the trade should be to buy all checkdowns and press these both to the long side.  

Update: analyst commented on the refiners said that both TSO and VLO are likely to post losses. I think this is because of oil, as mentioned. High oil apparently crushes their margins. I wouldn’t hold these into earnings, for certain.

Written by Tom@StockBlade.com · Filed Under TSO, VLO 

Comments

2 Responses to “VLO and TSO: Long”

  1. Tom@StockBlade.com on July 17th, 2008 10:58 am

    It looks like we have a trend break today, possibly on both…again never chase…wait to be long above the lows…but both of these appear to be trading inversely to oil…and thats a wildcard, obviously…

  2. Tom@StockBlade.com on July 17th, 2008 11:09 pm

    This is why I have a huge distrust of trends. We had a trend break on both TSO and VLO today early. They sat in a tight range. But the reality was, they were long above the lows, period. The problem is on trends, do I wait until tomorrow to buy weakness above the lows, or buy today?

    Oil popped lower, and off they went. This could be a difficult trade as they seem to be totally reliant on the direction of oil. keep in mind, i have not checked into their earnings release date….they both may post ugly numbers…I have no idea as i do not know enough about the refining biz to comment

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