Short term crude oil sell trade
Trade active:
Today at 10:30 EST crude oil inventory data will be reported.
I believe it is driven by the three main activities:
1) Crude oil U.S. exports. U.S. exports are on the up trend since the beginning of 2017. It was rising sharply since may and started declining in July. I believe it will decline a little more to touch the lower trend line as it has done before because of:
2) Oil production in OPEC. OPEC Oil production is on the rise and has touched the lower uptrend. I believe with the U.S. tensions with IRAN all producers will continue to increase production and wight on the demand from U.S. pushing down exports.
3) U.S. Oil import data It is hard to predict U.S. imports as they are fluctuating sharply. They rose on the last report by more than 10% and which is obviously bigger rise than in exports, which may create bigger inventories.
Overall putting these three factors together I believe that change in inventories should be positive, which is not what analysts are saying. If market will price in analyst expectations and my scenario plays out, we should see a very nice event driven gap or quick drop down :)
Let's sell this bad boy
I believe it is driven by the three main activities:
1) Crude oil U.S. exports. U.S. exports are on the up trend since the beginning of 2017. It was rising sharply since may and started declining in July. I believe it will decline a little more to touch the lower trend line as it has done before because of:
2) Oil production in OPEC. OPEC Oil production is on the rise and has touched the lower uptrend. I believe with the U.S. tensions with IRAN all producers will continue to increase production and wight on the demand from U.S. pushing down exports.
3) U.S. Oil import data It is hard to predict U.S. imports as they are fluctuating sharply. They rose on the last report by more than 10% and which is obviously bigger rise than in exports, which may create bigger inventories.
Overall putting these three factors together I believe that change in inventories should be positive, which is not what analysts are saying. If market will price in analyst expectations and my scenario plays out, we should see a very nice event driven gap or quick drop down :)
Let's sell this bad boy