Crude Headed Lower Again
Crude is seeing record long speculation again.
At the same time, fundamentals are turning unfavorable for long speculators.
The fundamentals point to an increase in U.S. production, inventories above average and Libya restoring exports. Ukraine is not a large producer and Russia is not going to lose production.
These factors put together mean that crude will likely trade lower in the weeks and months ahead.
The last time I commented on crude (USO), the fundamentals had mixed with wild speculation to make it likely that the prices were headed significantly lower. They did, dropping by 15% or so over the next few months. Since then, most of the carnage was again recovered, and again we're witnessing wild speculation.
Interestingly, this presents a setup where, again, the mo
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