RE:RE:RE:Still hanging onJnewsted wrote: d_trump wrote: What is your short thesis? I see limited and very brief downside yet very significant upside for oil. Supply/demand is more or less balanced, and despite all the doom and gloom demand keeps chugging along, and sources of new supply are very limited due to massive capital spending cuts. Also supply disruptions are inevitable considering all the basket-case nations that produce oil.
Two weeks agos I said that whenever the chorus of "it's going to $xx" (ie $35) gets louder, that's when you know it will never happen. It's still possible that we drop below $40, but it will be very brief.
IMHO worst case for oil is that we trade sideways in the 40's for longer than I expect. Oil will be much higher than $50 in the not too distant future but I just don't know if that is 3, 6 or 9 months away.
The only way I would short an oil stock right now is if were part of a pair trade (short one name and long another)
Yup, when everyone is trying to gamble on the same thing, that's usually when it doesn't happen. Huge amounts of bets have been put on the mid-30's, so no surprise that the media is being paid to put $35 and it seems like limitless people are paying to go on TV to push that narrative. But, where I see the failure is that speculative shorts hit a record in WTI, but they only managed to get oil down to $39. The same number of shorts loading up got oil near mid-20's last time. The options gambling for mid-30's is extremely crowded already, there isn't much dry powder left to manipulate the price lower.
I totally agree and now that OPEC is flapping their lips again the shorts are doomed. I think by the time the meeting is over ( which nothing will be agree upon again) the oil fundamentals will have changed once again and oil will take a quick drop then back up to $50 and beyond. The Saudis as someone mentioned are getting to the point of no return and have to Orchestrate the market now for their upcoming IPO and they need investors to see the upside. This is gonna get interesting. GLTA