{"id":13856,"date":"2019-06-07T07:30:06","date_gmt":"2019-06-07T11:30:06","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=13856"},"modified":"2019-06-07T07:30:06","modified_gmt":"2019-06-07T11:30:06","slug":"the-pre-holiday-oil-trade","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/the-pre-holiday-oil-trade\/","title":{"rendered":"The Pre-Holiday Oil Trade"},"content":{"rendered":"

Oil is crashing.<\/p>\n

The price of the gooey black stuff has fallen 12% over the past week. It’s down 21% from its April high.<\/p>\n

This action has lots of the talking heads on the financial news networks declaring that<\/a> oil is now in a bear market. They’re looking for lower prices. One prominent analyst said yesterday that he expects a barrel of West Texas Intermediate Crude (WTIC) to trade as low as $40 over the next few weeks.<\/p>\n

Don’t count on it.<\/p>\n

It’s summertime. Independence Day is less than one month away. And, as any brave soul who has ever rented an RV to take his family on a cross-country road trip during the summer can tell you, oil prices tend to rise going into the Fourth of July.<\/p>\n

So, the typical post-Memorial Day selloff in crude oil gives astute traders a chance to buy in anticipation of the typical pre-Independence Day rally.<\/p>\n

The strategy sure worked well last year. Take a look at how the United States Oil Fund (USO) – an exchange-traded fund that tracks the price of oil – behaved last summer<\/a>…<\/p>\n

\"\"<\/p>\n

Traders could have purchased USO in early June for about $13.20 share. It was trading above $15 by the end of the month. That’s a 13% gain in just over three weeks.<\/p>\n

It looks to me like oil is setting up for a similar move this year. Here’s the current, six-month chart of USO…<\/p>\n

\"\"<\/p>\n

Following the typical post-Memorial Day decline, USO is now quite oversold. The MACD<\/a> and RSI<\/a> momentum indicators are more oversold than at any time since last December – just before USO bottomed and then rallied 19% in about two weeks.<\/p>\n

It’s hard to imagine a big decline from here, with the technical indicators in such an oversold condition. And, with Independence Day less than one month away, aggressive traders should probably use any short-term weakness in the price of oil as a chance to buy.<\/p>\n

The price of oil should be higher three weeks from now than where it is today.<\/p>\n

Best regards and good trading,<\/p>\n

<\/p>\n

Jeff Clark<\/p>\n

Reader Mailbag<\/strong><\/h2>\n

In today’s mailbag, Jeff Clark Trader<\/em> subscribers thank Jeff for profits on a recent trade…<\/p>\n

\n

I just joined Jeff Clark Trader<\/em> last month, with a lifetime subscription. Today, I closed out the call option you recommended for a 150% gain in less than three weeks.<\/p>\n

I was able to get in a $0.60 and sold for $1.50. I started small. One more trade like this I will have paid for my lifetime subscription. Thanks, and keep up the great work!<\/p>\n

– Thomas<\/strong><\/p>\n<\/blockquote>\n

\n

I bought four contracts at $283.61 and sold half my position today at $324.00. That is the first time I made a profit in a long time. Thank you, Jeff. If this continues, I will be able to make even better profits soon.<\/p>\n

– Paul<\/strong><\/p>\n<\/blockquote>\n

\n

Great… got in at $0.49 and sold half. That’s better than 100%… waiting on the second half now… I like your way of thinking. Everything is in the detail and you’re a good man. Pay attention, everybody.<\/p>\n

– John<\/strong><\/p>\n<\/blockquote>\n

How do you plan on trading oil? What other sectors are you following? <\/p>\n

Let us know, along with any other trading questions, suggestions, or stories at feedback@jeffclarktrader.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Oil is crashing…<\/p>\n","protected":false},"author":37,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-13856","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/13856","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/37"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=13856"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/13856\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=13856"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=13856"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=13856"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=13856"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=13856"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=13856"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=13856"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}