Cramer bullish on ExxonMobil (XOM), oil market

Exxon Mobil Corp. (NYSE: XOM) opened at $84.50. So far today the stock has hit a low of $83.70 and a high of $84.67. As of 11:05, XOM is trading at $83.84, down $0.68 (-0.8%).

After hitting a one-year high of $93.62 in July, the stock has retreated over the past month as oil prices have come down some. Jim Cramer expects oil to be strong over the next few days, especially as the Fed works to pump more money into the system. Though some investors are concerned about growth, Cramer says shortages will be the bigger issue, and that will only boost oil prices. Technical indicators for ExxonMobil are bearish but improving, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bullish hedged play on this stock, I would consider an October bull-put credit spread below the $70 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk and leverage returns. For this particular trade, we will make a 4.2% return in less than 2 months as long as XOM is above $70 at October expiration. XOM would have to fall by more than 16% before we would start to lose money. Learn more about this type of trade here.

ExxonMobile hasn't been below $70 since October and has shown support around $82 recently. This trade could be risky if the demand for crude oil tails off, but even if that happens, the stock could be protected by support just above $80, combined with the stock's 200 day moving average, which his currently at $78 and rising.

Brent Archer is an options analyst and writer at Investors Observer. DISCLOSURE: At publication time, Brent neither owns nor controls positions in XOM.