Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Is It Time To Look At Refiners Again?

|Includes:ALJ, UGA, USO, Valero Energy Corporation (VLO), XLE

A strategy I like to use for swing trades is to find previously hot groups and wait for pullbacks and new setups to arise from new bases. Often, even if relative strength has faded, you can get at least a test of the prior price highs. Refiners are a great current example of this.

As gas futures have pulled in, gas prices haven't flinched in my neck of the woods. Also, it appears oil and gas may have bottomed as well. Perhaps it's a catalyst to get these stocks going. Let's take a look

Oil apparently has had a false breakdown of the symmetrical triangle forming since last fall.

(click to enlarge)Click to enlarge

We can also see a double bottom breakout in Gas fund UGA. (Gas futures have not broken the similar pattern yet)

(click to enlarge)Click to enlarge

Alon is a relatively unknown refiner. It sports a bullish head and shoulders bottom targeting 20 over 17.80.

(click to enlarge)Click to enlarge

The Valero chart is also sporting a bullish head and shoulders pattern. Over the neckline at 39 we can target the old highs at 44.

(click to enlarge)Click to enlarge

As you can see there is opportunity here. Whether it pays off...who knows. Good luck out there!

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in VLO, ALJ over the next 72 hours.

Stocks: VLO, ALJ, XLE, USO, UGA