USO United States Oil

[Bullitt]

Greed

Not really. It depends on what price the gasoline was purchased at that is being sold today. Gas stations rely on coffee, cigarettes and beer sales to stay keep the lights on. They don't make much on gas sales.

 

[bleeck]

I'm pretty sure prices at the pump will NOT fall as fast as they went up.
Greed

 

[Bullitt]

So, down around 22%, is oil now in a bear market?

 

[Bullitt]

More prominent in $WTIC, the uptrend appears to have at least taken a breather. This comes on news that inventories were lower than expected, so one would think prices should be higher. The lesson here is don't trade headlines.

Bullish for the consumer. Yes and no. There was a good book I read years ago by Ken Fisher titled, "The Only Three Questions That Count", and is recommended reading for anyone trying to decipher how markets work. The concept of the book is, "What do you know to be true that is actually false?". In the case of oil, sure, low oil prices are fun for consumers, but low oil prices can also be a predictor of a slowdown or recession.

Next support area in green. P&F chart shows a price target of 74.

 

[Bullitt]

Not the best vehicle for tracking crude but it does follow the daily futures moves. Today's Fed words put a swing high in oil with a new target price of low 50's in USO. This would equate to around $75 in crude oil futures. Last week crude was at $85.

 

[bleeck]

The Iranian Nuclear talks are on going, that would allow them to get that oil back into the legal world market.

 

[Bullitt]

Call options on WTI Crude with $100 strike price are going crazy. Of note, these aren't people making $200 call option bets at Robinhood.

USO currently at $47 and the only resistance overhead is the 200 DMA at $77.

December 2022 contracts with a strike of $100 are by far the most widely owned WTI call option on the New York Mercantile Exchange. Some traders are betting $100 oil could happen this year: $100 December 2021 calls are tied to 15.9 million barrels of WTI. In London’s Brent market, $100 contracts for December 2021 covered more than 32 million barrels last week, up from none at the end of last year, according to Intercontinental Exchange.

 

[Bullitt]

P&F chart calling for a target of $70's.

That was less than two months ago and seemed crazy bullish. $WTIC now at $61 as every weather event is bullish oil.

How are those wind turbines and solar panels working out in the past few weeks? Not good. "Global warming" didn't bring 80 degree oceans or tropical weather to all regions like we were promised, so they changed the name, and in fact I saw a weather guy on MSM claiming the recent cold streak throughout the US is due to "climate change".

The few times I filled up in 2020 I'd look at the price and think, "You won't see these prices for long." Oil is here to stay.

 

[Bullitt]

P&F chart calling for a target of $70's.

 

[Bullitt]

USO up 8% past three days thanks to Labor Day weekend.

 

[Bullitt]

Not USO, but $WTIC. Gap at $40 is filled, where do we go from here? Back to $22?

 

[Bullitt]

Dieing a slow death.

RBC, currently USO’s only FCM, has expressly informed USO that, until further notice, USO may not hold positions in the Benchmark Futures Oil Futures Contract and that it may not purchase any other Oil Futures Contracts for USO’s portfolio through RBC whether or not such purchases would be within the limits permitted by the exchanges.

In the strictest literal interpretation of the filing, it could mean that unless it finds an alternative clearer pronto, the USO will be forced to liquidate all its holdings before the next roll period. A looser interpretation might be that it is allowed to hold onto existing positions but not be allowed to add new ones. In a continuing contango market this would see it run down its overall position over time.

https://ftalphaville.ft.com/2020/05/21/1590062349000/USO--Uncleared-and-present-danger-/

 

[Bullitt]

^^Those were some fun times.^^

FWIW, I don't think I ever did buy USO, but I did trade UNG twice. Once had a gain, once for a loss. They both weren't horrible trades, but it was around that time I figured out UNG and USO really have nothing to do with their respective commodity prices. The thing was, in 2008 USO was at 900+ on a split adjusted basis, UNG was around 2,000. Both were very popular trading vehicles and remind me of bitcoin today.

USO today:

Last week, USO made a rare move called a “reverse split” that signals the fund is preparing for the worst. In short, it consolidated all its shares into fewer proportionally valued shares.
For example, before April 28, USO had 1.5 billion shares in circulation at $2.2. Today there are one eighth as many shares at 8X the price.


There’s no actual benefit in pulling this off except for one thing. Their management is afraid the fund’s shares would plunge below $1. And stock exchanges often delist stocks that trade below $1 to prevent price manipulation.


Let it sink in. The stock price was over $2 before the reverse split. That means USO insiders are worried the fund could plunge another 50% from today’s lows!


Meanwhile, investors are clutching at this ticking time bomb as if it’s a surefire way to profit from rebounding oil prices. Don’t be one of them.

https://www.etftrends.com/alternatives-channel/oil-investors-are-doomed-even-if-oil-prices-recover/

 

[Bullitt]

USO right back to where it was around 12/10/2009 which really would have been a nice entry point at the time. The only problem now is, USO has not only broken the trendline, but also has broken the 200 DMA. Where do we go from here? This is another major signal that the market is telling us right now.

View attachment 8094

 

[Bullitt]

Wow, forgot about this thread. Too bad USO doesn't track crude so well when it trades in contango and all, but the end of November would have been a good opportunity to begin buying.

USO breaking down here, but I think this is another buying opportunity. I don't expect oil to go much lower than 70. OPEC won't allow it.

 

[Show-me]

Looking to buy some of this soon.

 

[Show-me]

Yep, it is screaming buy. AlphaTrends says it is a buy. Saudi's will not let the price stay down for long they all have big projects to fund.

 

[Bullitt]

Time to start moving back into USO Show-Me? Nice exhaustion gap below the 2 year support yesterday could be a reversal indicator.

 

[Show-me]

Still hanging in there even though it hurts. Bought this at $49.95 and $48.32 so I have some cushion.

The 50 dma could be a support point.

http://stockcharts.com/h-sc/ui?s=USO&p=D&yr=0&mn=6&dy=0&id=p51972347693

Sold both positions @ $59.75, not a bad trade. Now watch it go higher yet now that I sold it. LOL

 

[Show-me]

Sold USO to free up some cash. Made a new high and I feel it is due after a strong run. It is not out permanently just may have some other fruit to pick.