Have you been piling into oil with the rest of the hot money? Might want to think about covering…or even reversing…your position.
Oil expert Matt Badiali writes:
The fact that oil didn’t leap up with delight at riots in Iran should make oil investors quake with fear. Iran produces about 5% of the world’s oil every day. Its populace is rioting… and yet the price of oil fell 3%.
As my colleague Brian Hunt pointed out, it’s a big bearish sign when an asset cannot rally on bullish news. We could see oil prices go into decline any minute.
Since breaking the $70 mark, oil has looked a bit toppy. News that China has stockpiled more oil than it can handle appears to have given investors pause.
Oil may be running out of breath after a huge run-up. (Source: Barchart.com)
Now’s probably a good time to take some profits…and if you like to live dangerously, maybe even consider taking a small short position for a short-term trade.
PS – If you’re a fan of short-term trading, I’d suggest you check out Jeff Clark’s S&A Short Report. It’s pricey…but if you’re a serious trader, it’s really top notch insights and recommendations. And right now they are running a special 3-month trial deal.
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