Above you will see the daily candle chart of OIH. The stock is bouncing nicely off of the role reversal support level taken from the most recent lows. The dropping volume on the sell side supports the buy signal. As the sellers lose their desire to sell the volume will bleed off just before the buyers jump into the market. You can also see a gap target at the previous high, around $44. Our goal is to buy long term call options (LEAPS) with the intention of selling short term, front month, options against the leaps after the stock has rallied. This will put us in a nice calendar spread that we will be able to work for a while.
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