National Oilwell Varco (NYSE: NOV) Buy This Energy Stock's Breakout for Potential Double-Digit Gains

Thus far, September has brought a little upside in U.S. stocks and marginal increases in the daily trading ranges, i.e., more choppiness.

The Energy Select Sector SPDR (NYSE: XLE) is slightly outperforming the broader market, up 1.6% so far this month compared to 1.4% for the S&P 500. Of course, one week does not make a trend, particularly a Labor Day shortened trading week that also included a major Jewish holiday and ongoing headlines from the G-20 meeting. However, the relative outperformance combined with a friendlier looking chart makes the energy sector an interesting place to dig for long-side candidates.

XLE continues to grind higher through a series of rallies and consolidation phases that pull back to the uptrend line that dates back to June 2012. The most recent retest of that trendline came in late October, which also qualified as another higher low.

Since then, the ETF has worked its way up toward the 2013 major resistance line just shy of the $84 mark. An eventual push past this line would be bullish and a continuation of the series of higher lows and higher highs.  (more)

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