Quote:
Originally Posted by Clayton
if i've learned anything from trading oil the last 4 years, take your gut instinct on what makes sense and then do the opposite. it's the quintessential pain market. only time logic made sense was the thanksgiving OPEC massacre.
in all seriousness though, i think market is paying more attention to OPEC's poor attempts at strengthening/lengthening cuts and the supply situation is so much bigger than any short term geopolitical issue. you'd need to see destabilization in the bigger producers for a measured longterm geopolitical buy.
Oil has been range bound for quite a while and has lost a lot of its volatility. Yesterday we had a huge rip down on the inventory report and after that 5-10 minute rip it was deadass sideways the rest of the day.
Oil is dying as a trading vehicle just like its cousin Natural Gas did. NG was the greatest trading vehicle ever until the 2008 bubble burst and fracking took hold. Since then it has been a miserable market to trade as they improved the technology and extraction methods so much which basically gives an unlimited supply. The same thing is now happening in oil. It has been taking a little longer to take hold in oil since it is both a much bigger and more global market. Plus it has a lot of sovereign government influence.
But the technology and extraction methods are so improved in the last decade I really can't envision any of those old school oil rallies happening maybe ever again. I hope I am wrong as I love trading these markets when they are volatile but lately the volatility just isn't there. If NG is an indicator it aint coming back.