Editor's note: As you probably know, the energy sector has been struggling this year... And the Power Gauge has seen the problems. Energy is the lowest-rated sector in our system right now.
And the Power Gauge has seen the problems. Energy is one of the lowest-rated sectors in our system right now.
But in times like these, it's also good practice to hear the other side of the argument from the smart folks "in the room"...
Longtime Chaikin PowerFeed readers are familiar Brett Eversole. He's an editor at our corporate affiliate Stansberry Research. And he specializes in finding opportunities with contrarian signals.
Today's essay comes from the June 10 edition of Stansberry's free DailyWealth e-letter. In it, Brett shares why he thinks oil could be on the brink of a turnaround...
Oil's Decline Is Almost Over
By Brett Eversole, editor, Stansberry Research
A single investment story can suck all the air out of the room...
For most of 2025, one of those stories has been tariffs. They've rocked the markets and the economy this year... They're practically the only thing folks are talking about.
Still, there are plenty of other stories worth paying attention to right now...
One is energy prices. Specifically, crude oil prices have crashed this year. And now, sentiment is hitting hated levels.
That means a reversal is likely. And we could see $100-per-barrel oil much sooner than anyone believes possible...
Stansberry Research founder Porter Stansberry accurately predicted the world's largest mortgage brokers, Fannie Mae and Freddie Mac, were headed toward bankruptcy. He did the same with General Motors in January 2007. Now, he's warning about the No. 1 most dangerous investment in America to avoid and THE one strategy anyone subscribing to financial research should implement immediately. Stream Porter's urgent announcement here... before it goes offline at midnight tonight.
Legendary quant analyst Marc Chaikin says, in his 50 years on Wall Street, ONE stock-cycle indicator worked better than anything else. It has been studied by Charles Schwab, T. Rowe Price, Goldman Sachs, and more. And now, Marc is sounding the alarm because this cycle indicator is pointing to March 2026 for the next big crash. Get the facts here.
In normal times, a crash in crude oil would be a major story. But today, it's getting lost in the sea of constantly shifting tariff news.
We've seen a huge decline in oil prices in recent years. In the summer of 2022, oil prices soared above $120 a barrel. They recently dropped below $60 a barrel for the first time in years.
That's a 50% decline in roughly three years. And in 2025 alone, the peak-to-trough decline reached nearly 30%.
Traders Are Betting on a Continued Drop in Oil
After this painful drop, traders are "all in" on lower oil prices. We can see it by looking at the Commitment of Traders ("COT") report...
This weekly report shows the real-money bets of futures traders. When these folks all agree, they tend to be wrong... So we can use extreme COT readings as contrarian signals.
Right now, traders are about the most negative they've been on oil in the past 12 years. Take a look...
As oil prices fall, traders assume they'll keep falling. But eventually, sentiment gets overdone... And when there's no one left to sell, prices reverse.
I've highlighted a handful of these moments in the chart above. They all mark major sentiment lows based on the COT report. And they were all periods where oil prices reversed and moved much higher.
Look at the oil return in each case...
These oil setups led to an average rally of 72% in about six months.
Those are massive short-term returns. Even if we don't count the COVID-19 pandemic bottom (which is quite an outlier), the average return is still 45% over seven months.
Either way, the signals tend to unfold near bottoms for oil prices. And given the drastic decline we've already seen, a major reversal is likely soon.
Again, when traders all agree, we want to do the opposite.
History shows oil could easily shoot back above $80 a barrel in the months ahead. And while it seems impossible today, $100-per-barrel oil could be a reality at some point in the next year.
Good investing,
Brett Eversole Editor's note: As we've noted, it's good practice to hear out the contrarian takes from folks like Brett. And to get regular insights like this from him, you can sign up to receive DailyWealth directly...
Just like the PowerFeed, this e-letter is free to read. And it publishes each weekday morning that the markets are open. Learn how to sign up for DailyWealth by clicking here.
Market View
Major Indexes and Notable Sectors
# Hld: Bullish Neutral Bearish
Dow 30
UNCH
8
15
7
S&P 500
-0.29%
100
264
136
Nasdaq
-0.34%
34
52
15
Small Caps
-0.41%
510
1018
359
Bonds
+0.3%
Energy
+1.45%
3
11
9
— According to the Chaikin Power Bar, Small Cap stocks remain somewhat more Bullish than Large Cap stocks. Major indexes are mixed.
* * * *
Sector Tracker
Sector movement over the last 5 days
Energy
+5.3%
Communication
+2.17%
Health Care
+1.85%
Information Technology
+1.49%
Real Estate
+0.55%
Financial
+0.41%
Industrials
+0.29%
Materials
-0.03%
Utilities
-0.06%
Consumer Discretionary
-0.07%
Consumer Staples
-0.9%
* * * *
Industry Focus
Oil & Gas Exploration & Production Services
8
28
17
Over the past 6 months, the Oil & Gas Exploration & Production subsector (XOP) has underperformed the S&P 500 by -6.05%. Its Power Bar ratio, which measures future potential, is Weak, with more Bearish than Bullish stocks. It is currently ranked #15 of 21 subsectors and has moved up 2 slots over the past week.
Indicative Stocks
CLNE
Clean Energy Fuels C
CNX
CNX Resources Corpor
COP
ConocoPhillips
* * * *
Top Movers
Gainers
WBD
+5.0%
SBUX
+4.33%
GEV
+3.9%
AVGO
+3.38%
CF
+3.38%
Losers
INTC
-6.34%
NUE
-6.06%
UAL
-5.49%
DAL
-4.86%
LMT
-4.26%
* * * *
Earnings Report
Earnings Surprises
No significant Earnings Surprises in the Russell 3000.
* * * *
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