A year ago transportation companies, airlines, truckers, buses, taxi's and shuttles were tacking on oil price fees to compensate for $140 oil. What will they do for us at $20 oil?
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Monday, April 06, 2009
Deflation & Oil
The case for oil is a bearish one. The Daily chart of USO below reveals a long term downtrend that is unfinished to the downside. Notwithstanding day-to-day fluctuations, the pattern is not all that different from stocks:
A year ago transportation companies, airlines, truckers, buses, taxi's and shuttles were tacking on oil price fees to compensate for $140 oil. What will they do for us at $20 oil?
A
A year ago transportation companies, airlines, truckers, buses, taxi's and shuttles were tacking on oil price fees to compensate for $140 oil. What will they do for us at $20 oil?
A
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3 comments:
Thanks for the update. I sold out of DXO at 3.16 as I expected oil to hit some resistance around 55. I agree there will be a DTO trade here at some point, I'm just not sure when.
Back in February you thought USO could potentially reach the 40-45 range. Do you still think it has a shot at getting that high?
I wouldn't want to be long it here anyway. USO went up almost 50% in one month, that's a lot for a commodity.
David, That bullish wave count is still alive, barely. But the long drawn-out Wave 4 seems to be failing here and trend model is solidly bearish. A perfect example where Forecast says 40, but Trend is going other way and for trading purposes, the trend is your friend.
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