WTI TA & FA, targets explained.. - Epic RR 19:57:19 (UTC) Considering adding at these levels to an existing long position. I don't think that the teens will be met. I think $20/bbl will hold. If it doesn't, then it is manipulation of price virtually, as here in Texas the Permian basin is solid and in fine shape compared to Canadian heavy barley getting 4$ bids. I see this is more of a fundamental investment rather than a swing trade at this point. Proper risk management is always applied, with a per risk trade of 2% max; negating a failed account in the long-run of a thousand trades.
Bullish arguments: include cuts from open assuring a $20 spot market. Cuts from OPEC+ and other producers mean that a unilateral bottom has been agreed on.
Suppliers control this market with the flip of a switch (lertaly). My target for May of this year is $41/bbl. The drop in demand has been forced. Fundamentally, anyone who's traded in a market with forced demand/supply knows how to handle this.
Bearish argument:
Slow down in demand.. obvious. The suppression is forced, and those that weren't leveraged and had good cash flow going into the year with adequate solvency are fine. It's the ones that were desperate for gain that want to see Oil to 0$. Of course, it already has been trading negative in parts of the world that don't have the infrastructure to maintain profit with these prices.
According to my source 4$/bbl in Canada is enough to break-even. While firing and downsizing. The infrastructure for heavy crude in Canada is expensive and can't just be towed off of the lot like it can here in Texas. Bears shouldn't be worried about WTI, they should be looking at Brent and heavy Canadian.
19:59:32 (UTC)
Tue Apr 14, 2020
