Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Halcon Resources (NYSE:HK) stock got a 16% lift on Wednesday as WTI and Brent crude oil benchmarks edged higher just a day after hitting a five-year low. The sudden turnaround suggests that the market did something less than novel yesterday -- overreact.

HK Price Chart

HK Price data by YCharts.

So What: The surge on Wednesday shouldn't come as much of a surprise to Halcon Resources investors, given that 85% of its total production comes from oil. With the rebound in oil prices, Halcon Resources is just one of the many oil-and-gas drillers in the market experiencing highs. The S&P Oil & Gas Exploration & Production Select Industry index is up 8% today illustrating that the favorable uptick is not entirely indicative of the company's underlying fundamentals. The company has taken positive measures to brace for continued oil price volatility in the year ahead.

Now What: In its third-quarter earnings announcement, Halcon Resources Chairman and CEO, Floyd C. Wilson, recognized the impact of rapidly declining oil prices on its business, and positioned for 2015 accordingly. Through the first three quarters of its fiscal year, Halcon Resources spent more than $921 million on drilling and completions, which comprise more than 75% of its total capital spending. Going into 2015, however, the company plans to trim these capital expenditures to a more conservative range between $750 million to $800 million, and expects to reduce the number of rigs in operation to six -- down from the 11 originally planned.

With around 80% of expected production hedged through 2016, Halcon Resources has bought itself some time to withstand current oil price fluctuations. But as we've seen in the last two days, oil prices are anything but predictable.

Nate Wallingsford has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.