Lanmar

Long term view on oil - Use DWTI as indicator for long entry

AMEX:DWTI   VELOCITYSHARES 3X INVERSE CRUDE ETN LINKED TO THE S&P GSCI CRUDE OIL INDEX EXCES
I've been using DWTI             (Inverse ETF of oil             ) as an indicator to time oil             . My projection is DWTI             will hit $255 per share when oil             is trading in the low 30's. At that point I will go long oil             and expect DWTI             to trade lower. Why DWTI? Because the structure is extremely clear to me whereas oil             shows a lot of POTENTIAL bottoms. DWTI             , although a derivative of real price, has very clear signals for topping, which is obviously good for oil             .
Comment:
snapshot
Comment: This trade may become invalid. If DWTI opens above my blue box I will not initiate a trade. This definitely looks like it will happen.
Order cancelled: THE BREAKOUT IN DWTI INVALIDATES A LONG TRADE IN OIL. I'm becoming more convinced oil is headed to $22.
Comment: My "Extremely Unlikely" area is now far from extremely unlikely. I am inclined to believe that the $16 level has become more likely than the $40 level in the near future.
Comment:
snapshot
I believe definite 22, with a final low between 12 and 17
+1 Reply
Lanmar PRO smitheric1970
Agree
Reply
Why change opinion?
Try an inflation adjusted crude...I'm long oil, not directly but long with a wide stop.
+1 Reply
Lanmar PRO IvanLabrie
Ivan, show me any asset/market/instrument that decisively broke its 2009 low on the weekly timeframe, and I will bet we'll see trend continuation far deeper than we've seen thus far in oil. It is against my strategy to buy oil at ~29, so my opinion has not changed. My execution, however, has changed. Unless we close at 33-34 by months end, the cheapest I am willing to pay is $26 per barrel. But at this point I am leaning more toward 22 - 16. I have several long entry orders - first at 26. I have checked inflation adjusted crude - it certainly makes it exciting to buy long term, but again, the cheaper the crude, the more extended our leverage can get - I see cheaper crude coming.
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