Nyse Order Imbalance 510951.0 Shares On Sell Side

By Doug Busch

The energy sector is showing renewed life, with exploration and production stocks starting to catch up to equipment peers. The VanEck Oil Services ETF continues to lead the group, up 8% year to date, trailed closely by the State Street Energy Select Sector SPDR ETF's 6% return. The State Street SPDR S&P Oil & Gas Exploration & Production ETF is up just 2% this year.

Technically, all three ETFs look solid. The oil services ETF has climbed above a bull flag pivot at $290 and the Energy Select Sector SPDR Fund is approaching its $92.32 cup-with-handle pivot. Meanwhile, the State Street ETF sits right at its own $135.26 cup-with-handle pivot, signaling potential upside. I last highlighted this group in mid-November, noting names like SLB, APA Corp, and Valero Energy. Today's charts suggest momentum could carry the sector further into year-end 2025 and 2026.

Keep in mind that this resilience is unfolding even as crude prices hover near $60/barrel. Recent geopolitical events, including Israel's campaign in Iran and ongoing discussions about a potential intervention in Venezuela, have not caused a major impact on the commodity. With crude slipping while energy equities press higher, the divergence suggests the group's momentum could have further room to run.

Let's turn our attention to three names that appear primed for additional gains.

Devon Energy, an oil and gas producer, is showing excellent relative strength, up 16% in 2025 to handily outperform benchmark ETFs. On the daily chart, the stock broke above a $37.36 cup-base pivot on Monday, but it's the monthly chart that truly stands out. At the bottom of the chart, the stock just registered its first bullish moving average convergence divergence, or MACD, crossover in five years. This indicates short-term momentum is overtaking long-term momentum and often marks an early shift in trend. It last occurred during the completion of a bullish morning star pattern in late 2020, which successfully retested a bullish piercing line from April 2020. The stock then surged from $8 to $80 over the following two years before forming a bull flag that ultimately broke to the downside.

I believe the May doji candle represents a meaningful low, and notice the April 2024 doji established a longer term double bottom base. One can enter here and remain bullish above $34, targeting a move toward $43 by late first quarter, which would represent roughly a 16% gain from current prices.

Devon Energy traded around $37 Monday.

Suncor Energy, the Canadian integrated oil and gas company, is up 26% year to date and offers a dividend yield near 4%. The stock now trades just 2% below its 52-week high and has been sprinting higher since a strong 4% earnings gap on Nov. 5. That day's session also completed a bullish island reversal following the Oct. 10 gap down. Technically, the stock's quick recapture of its 21-day exponential moving average underscores improving momentum, and the mid-October lows successfully retesting the former double-bottom breakout pivot from June adds further conviction.

A move above the current bull flag pivot at $45.25, formed by tight consolidation after an 11% gain the first half of November, could target $53 in the first quarter of 2026, representing roughly a 20% advance from current levels. Remain bullish above $42.

Suncor Energy traded around $44 Monday.

SandRidge Energy, a Midwestern oil and gas play, is enjoying a strong 2025, up 24% year to date, but the real story is the explosive 67% surge off the April lows. The stock offers a 3.3% dividend yield, and the past two weeks have been only fractionally lower, a healthy pause following a powerful four-week winning streak that delivered a combined 29% gain. The stock broke forcefully above a $12 bullish ascending triangle pivot on Nov. 5. Importantly, that breakout has not just held but continued to grind higher, exactly the type of follow-through technicians want to see. Note how this level rejected price twice earlier in the year, with negative reversals with bearish shooting star candles forming on June 18 and Oct. 6.

Adding to the bullish setup, Monday produced a break above a bull flag pivot at $14, further confirming upward momentum. Look for a move toward $16.50 by year-end, which would represent an additional 16% advance from current levels. Remain bullish above $13.50.

Sandridge Energy traded around $14.25 Monday.

Doug Busch is the senior technical analyst at Barron's Investor Circle . His technical view is added to stock picks, including those published exclusively for Investor Circle readers. A glossary of technical terms is updated regularly with new entries.

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