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Tuesday was a big day for stocks. Several sectors have been beaten up since the beginning of May. Of these stocks, some are well above the 200-day moving average. Much recent commodity weakness has to do with a strengthening dollar. Worries that Greece would default on its debt has weakened the euro. Tuesday's optimism of a bailout for Greece changed momentum, weakening the dollar. Four days of gains in the stock market have created optimism in the global economy. A pull back in the dollar due to a strengthening euro aided materials stocks. Basic materials' demand is based on global growth. Optimism in global growth coupled with a weakening dollar could prop up this sector and create an environment where basic materials lead the next market move.

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The S&P 500 has pulled back, but held resistance. I would watch this trend, but one could start or add to positions at this point. Watch closely this trend does not break down. There are several ways to play this. The first investment opportunity is in refining and marketing. I have several reasons why I like this sector as identified in 4 Refiners Looking Good Due to WTI Leverage. Economics of the refining business have changed. The decrease in brent crude production from the North Sea and OPEC has increased its value. Much of the increased production from Saudi Arabia has been sour crude, as it seems OPEC will have trouble increasing production of its light sweet crude. This should continue the upward momentum cost/barrel.

The price of WTI has decreased in price/barrel because of the large inflows of oil from areas like the Bakken, Niobrara, Eagle Ford, Anadarko Woodford and Permian. This oil is beginning to back up in Cushing, and lowered its cost due to supply outstripping demand. When choosing a company within a sector, understand that those that consistently outperform will continue to do so. I would also recommend companies that have refineries in the mid-continent. These companies will have much higher margins than those without access to crude from unconventional resource plays in the United States.

Western Refining (NYSE:WNR) was up 4.29% on Tuesday. Analysts estimate it will grow 2472.7% this year. Western Refining's El Paso and Gallup refineries have significant access to oil from the Niobrara and Bakken shales. As the refining business improves, this company will be a takeover candidate.

Delek Holdings (NYSE:DK) was up 3.56% on Tuesday. Delek recently stated it had improved earnings based on differentials in the price of WTI to brent crude. It averaged $11/barrel the last quarter. Analysts estimate it will grow 436.1% this year.

Holly Corp. (HOC) was up 3.37% on Tuesday. Year over year from the first quarter of 2010 to 2011, margins improved from $5.56/barrel to $15.72/barrel. Holly's ability to process sour crude has and will continue to improve throughput volumes. Analysts estimate that Holly will grow 237.6% this year. The upcoming merger with Frontier (NYSE:FTO) will provide further cost savings.

Frontier was up 3.25% on Tuesday. As with Holly, Frontier has 100% exposure to cheap WTI. Frontier continues to benefit from the build up of inventory at Cushing. This is a long term problem, from which Frontier should continue to benefit. Analysts estimate Frontier will grow 843.2% this year.

All names are trading well above the 200-day moving average. Since March, this sector has traded sideways, and could be ready to make another move upward. As a side note, I am bullish all refiners, but think these four will outperform the sector.

The second sector I am bullish on contains oil service names. Levered to oil demand, it is a way to play strength in the oil sector. This group has pulled back but had a good day Tuesday. Well-drilling times have been good, but fracking is a different subject. Without a contract, it is getting more and more difficult to get a frac crew. These crews are not only difficult to get, but problems associated with getting jobs done also exist. Due to a lack of experience in obtaining unconventional resource, frac times have been longer than expected. Since fracking is taking more time, many of the frac crews are late getting to a new project. Pump trucks are also scarce. If oil and gas producers want accessibility, they are forced to sign a contract. Those without contracts expect long waiting periods.

Three companies were up big on Tuesday that are well placed in this environment. Basic Energy Services (NYSE:BAS) has had very good momentum, even with the recent pull back. Basic has been adding hydraulic horsepower to its pressure pumping segment as demand has been high. Basic has been able to increase prices per truck significantly from $64,000/truck in 2009 to $88,000 in the first quarter of this year. Analysts estimate Basic will grow 229.8% this year.

RPC Inc. (NYSE:RES) has also done well. It derives 48% of its business from pressure pumping. Analysts estimate that RES will grow 103% this year; based on demand, this number seems quite low.

More of a play on value, Complete Production Services (NYSE:CPX) is also well placed, with its 200-day moving average still in place. Complete has a well-rounded business with 30% coming from pressure pumping. Analysts estimate that Complete will grow 150% this year. Complete is seeing very good demand in pressure pumping, coiled tubing and fluid management.

Oil and gas production has been hit harder than other sectors in the downturn. The reason for this is the abysmal first quarter. These stocks were sold off on the prospect of hedges digging into profits for the rest of the year. Since oil has pulled back below $100/barrel, many of these names are well-placed, and should not see the mark-to-market writedowns of last quarter.

Oasis (NYSE:OAS) is a pure Bakken play and has held up well with respect to its 200-day moving average. It recently pulled above its 200-day moving average, and has traded well over the last few sessions. Analysts estimate that Oasis will grow 245.9% this year. As companies like Brigham (BEXP), Northern Oil and Gas (NYSEMKT:NOG) and Kodiak (NYSE:KOG) have all dipped below the 200-day moving average, Oasis has continued above. All of these companies are cheap on valuation and should trend higher. The fundamentals of these stocks have not changed, and the writedowns from the first quarter were on paper only. All four of these companies should be significantly higher over the next year.

These stocks have pulled back to an area I believe has very little downside. I like all three sectors based on long term demand, and an improving economic environment.

Disclosure: I am long BEXP, BAS, WNR.