Crude oil continues to collapse, approaching $20 per barrel. A price war between Russia and Saudi Arabia timed perfectly with the COVID-19 pandemic has crushed oil to levels not seen since early 2000. Based on key technical chart levels, oil will find support at $17.50 and then $11.85. Oil will likely hit $17.50 but the $11.85 only gets tagged if we enter an all out global depression. At that point, the bankruptcies and job losses will mirror the 1930, and none of us want to see that. I believe the odds of that worst case scenario happening are very low, but should be taken into account. The $17.85/bbl level will likely be a major low if the worst case scenario does not come to pass. There is also a key point where Saudi Arabia and Russia feel max pain and will have to work together to raise the price of oil to keep from economic collapse. My guess that will be the $17.85 level. As an investor, accumulating best of breed oil stocks on as oil moves below $20/bbl will be scary but likely pay off in a big way over the next 12 months. Names like Chevron (CVX) and Exxon Mobil (XOM) are likely where you want to head. Check out the chart here... https://inthemoneystocks.com/major-levels-to-watch-on-wti-crude-oil/ Gareth Soloway InTheMoneyStocks Chief Market Strategist
What your thoughts about an oil company like Matador resources. Very new to stocks and bought into this one thinking the price would start to rise slowly but seems to be getting even lower. should I jump ship with this oil war going on?
If I wanted to bet that oil will hit 17.50$ and rebound back up to 40$ in 6 Months. Which would I buy when oil hits 18$? UWT - VelocityShares 3x Long Crude Oil ETN or is there another ETF?
After the May contract for WTI crude oil moved back above zero yesterday and the now front-month June contract is 'only' down 3% today, one might be tempted to think that a sense of normalcy is moving back into the crude oil market. Don't be fooled. First, let's look at the historical one-day change for WTI going back to 1983. After Monday's 306% record (in more ways than one) decline, yesterday's rally of 126.6% rally out of negative territory was the strongest one-day gain in WTI's history. It's not only the one-day daily changes that suggest the crude oil market is nowhere anywhere close to normal. In looking at the spread between the prices of the current (front month) contract and the price six months from now, the current spread is at levels rarely seen. Through yesterday's close, the spread between the two contracts was -$14.89 per barrel indicating that crude for delivery six months from now is nearly $15 more expensive than crude oil for delivery in the current month. While that's well off the record $68 spread seen at the close on Monday, going back to 2006, the only time the spread was at similar levels was during the depths of the financial crisis. One thing we know about the 2008/09 period is that there was nothing normal about then.
I guess we were all wrong on that crude price prediction did anyone buy some free oil for May delivery
Yeah, many here got this wrong. When Trump make enemies with people around the world the enemies will take advantage of Trump’s weakness. I think China sent a string message when Bank of China dumped oil futures contracts when there were no buyers on the market right before expiration date. If they did the same with US Treasuries now along with other stock holdings the stock market may see a scenario follow like we saw with oil. When the economy is weak and demand is weak one is quite vulnerable. These days many people don’t have a lot of money and most Americans are not out stock shopping sprees nor are they out on oil futures contracts shopping spree especially 1-2 days before expiration date.
Just could not resist posting this Yahoo Finance article... https://finance.yahoo.com/news/energy-sector-maintain-crazy-momentum-220000378.html "The good news for the bulls is that the oil outlook remains great. I have posted this on the ExxonMobil - XOM discussion thread too. Here is my chart for WTI ... https://drive.google.com/file/d/1Szd6nC23l4iTBPOyFqFL2ew_sjxy_BzK/view?usp=sharing
