Oil prices recently bounce off sharply from the low when it hits a negative number, This is pretty much common sense as speculators understand that oil prices cannot be in the negative range for long.
That logic invites plentiful Bulls in the market. But what to take note of is that as the cartels continues to dig more oil, and when storage is limited while futures speculators and hedgers do not take delivery of the commodity, it is possible for oil to stay near the $0 range.
Most countries lockdown has been extended , thou there are optimism for the US re-opening, with still growing infected rate, we view travel restriction will still be impose.
Therefore demand for oil would be greatly affected, currently demand has fallen 30%, we look for demand to continue at its lows for the next 2months.
With that said, it would give us another short opportunity when the oil reach the resistance zone and speculators starts taking profit.
USOIL
That logic invites plentiful Bulls in the market. But what to take note of is that as the cartels continues to dig more oil, and when storage is limited while futures speculators and hedgers do not take delivery of the commodity, it is possible for oil to stay near the $0 range.
Most countries lockdown has been extended , thou there are optimism for the US re-opening, with still growing infected rate, we view travel restriction will still be impose.
Therefore demand for oil would be greatly affected, currently demand has fallen 30%, we look for demand to continue at its lows for the next 2months.
With that said, it would give us another short opportunity when the oil reach the resistance zone and speculators starts taking profit.
USOIL