Chesapeake Energy: Peaking for Now?

Last Friday the jobs report hit with another 598k jobs lost in January the market moved up in spite of the bad employment news. Now Wall-Street and Main-Street are looking to the government to pass the huge stimulus plan help things out. I’m skeptical as many others are as to whether the current rally is sustainable right now, whether the stimulus plan is passed and especially if it’s not. Back in 2008 the big bail-out money that was given out and the big Fed rate cuts just resulted in buy on the rumor sell on the news rallies. I’m betting the same thing this time again too.

Last week my stock pick was a short sell on Nustar Energy (NS). So far so good with tight stop-loss. This week I’m putting another short sell on another big energy company. Fundamentally, energy is a great investment long term as long as the economy is growing, but the oil bubble pop last year, with the economy now in the toilet with who knows when it’s getting better, and demand destruction still in place, the deflation environment is going to hurt everyone, and it’s showing in the energy stock charts.