Ludwig_Von_Mises

Short-term Trade: OILU / USOIL Extremely Favorable Risk-Reward

Long
AMEX:OILU   MicroSectors Oil & Gas Exp. & Prod. 3x Leveraged ETN
I don’t believe OILU will stay at the $14 level for very long and conservatively speaking I’d say a 50% swing higher is likely.

Depending on your strategy, you could cap your loss at 2% or whatever your risk tolerance is and then go in full on a breakout. Personally, I’d buy half or a third now and hold. If prices fall, potentially up to 7% or so, I’d accumulate more and once the breakout happens go in full.
Comment: $14s if you can get em
Comment: We need to see some strength and reclamation of a rising trend, otherwise looks like $52, $50, and lower could be in store for USOIL
Comment: As long as the trend continuous up, then I think $58 is in store. But there is an increasing possibility of a big dump so be watching closely. If it looks bearish and feels bearish, its probably bearish
Comment: A simple buy and accumulate at the lows strategy would have you up 14% in the last 17 days. ;)

Its not about being bull or bear, its about identifying extremes and undervalued or overvalued prices. Oil could go towards $40, but OILU was likely going to move from $14 to $16 before any major move up or down.

USOIL has been technically pretty. Very curious to see how this plays out. If you’ve been in since $14 OILU, might be wise to take some profits and watch closely. You’ll be able to tell if its going to rally or dump but only if you watch closely ;)
Comment: Actually 20% if you got in sub-$14
Comment: Depending on your style & risk tolerance, you may want to consider shaving off some holdings here and let the rest run.

Personally, USOIL looks like it has some underrated strength. I would not be surprised to see a surge to $61 or $69 in USOIl. OILU would track that very nicely. A break past $70 would be incredibly bullish.

Oil can sell-off rather severely and unexpectedly, especially if we get overbought and cant surpass key resistance. $48 is a possibility. $38-$33 possible during 2020.
If inflation ticks up faster than most expect, Oil could outperform.
Comment: OILU is currently up 33% in 7 weeks since I posted this chart.
Trade active: USOIL is nearing a substantive move.
Most likely we will get:
1. Selloff towards 57-56 before chopping sideways and rolling over
2. A quick touch of $60-$61 before getting slammed
3. A surprise surge that opens up the upper 60s.

A surprise fundamental event could be the thing to shoot us to $64-$69.
Barring such an event, I think a move to $57 and $53, from present prices of $59, is the most likely outcome.
Comment:
Comment: this rally has been very impressive. $65 incoming
Comment: $65 USOIL, thats about $24-$25 OILU
Comment: sorry thats off base, I'm not sure exactly but it could be around $33 OILU
Comment: either this is a corrective countertrend, which means a hammer should be coming in any day now. OR this is a sign of rising inflation and rising commodities, which could mean 2020 is in store for higher oil prices
Comment: I believe now is time to be buying OILU again. The market has gifted you cheap prices once again
Comment: This is a buying opportunity