Short term idea on USOIL(1-2 DAYS) buying put options
This was a great week for the US economy and the oil market. The OPEC+ agreement, the surprise numbers in employment in the US and the flattening of the Covid-19 curve of infected people really gave spectacular returns to bulls.
Fundamentals: The 40$ price is very crucial for the producers as it is the breakeven point of Shale producers. Above that new oil rigs should open up.
TA: Bulls should take profits by monday, as we are in overbought territory (RSI>70). Plus we are close to a bearish divergence.
Time horizon: 1 day ideally as we are going against the trend.
I recommend the use of options because of the tensions between US and China. If escalated, we may see a significant gap upwards. Put options have an upfront premium payment and we know the risk beforehand.
Disclaimer: 1) Always do your own analysis before trading.
2) If you are not familiar with options DO NOT follow this idea.
Fundamentals: The 40$ price is very crucial for the producers as it is the breakeven point of Shale producers. Above that new oil rigs should open up.
TA: Bulls should take profits by monday, as we are in overbought territory (RSI>70). Plus we are close to a bearish divergence.
Time horizon: 1 day ideally as we are going against the trend.
I recommend the use of options because of the tensions between US and China. If escalated, we may see a significant gap upwards. Put options have an upfront premium payment and we know the risk beforehand.
Disclaimer: 1) Always do your own analysis before trading.
2) If you are not familiar with options DO NOT follow this idea.
Trade closed manually
Close @38.37 manually with a small profit. I expect a major bull market this summer.
Disclaimer
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.