Truth That Experts Aren’t Telling You About Oil Prices
Oil’s going to $150!
No wait, forget that, oil’s crashing all a approach to $20.
Hold on, that one’s right? Don’t ask me. we took a 3-iron to my clear round after we mislaid a gamble one night. But you’ll find all kinds of crazy predictions around a oil patch these days.
I’m not a fan of a guessing game. If we wish to make income in a markets we have to react, not guess. And currently we’re going to make income reacting to what a oil charts are indeed display us right now, not to what they could be display us in 6 months.
And today, what a charts are murmur competence warn you…
It’s too bad so many investors tumble for a guessing game. And we can count on a large banks to supply a bait. Our buddies over during Goldman Sachs, for example, have grabbed headlines with some of their oil forecasts.
“Forecast No. 1 was for a cost of WTI oil to lapse to $45 per tub by Oct of this year,” explains a appetite maven over during Outstanding Investments, Jody Chudley. “The logic behind this call is that a new convene in WTI oil prices from a low $40s to nearby $60 is going to be ‘self-defeating.’”
In other words, a drillers are going to holder adult prolongation again interjection to aloft prices, withdrawal us awash in oil. Then oil prices will tumble again.
“Goldman’s second bearish call is long-term in inlet and utterly eye-opening,” Jody continues. “Goldman thinks that WTI is indeed going to continue to diminution over time, eventually environment during $50 per tub in 2020.”
Take both these predictions with a dump lorry full of salt. As Jody reminds us: There is zero in Goldman’s lane record of presaging oil prices to advise they know what they are articulate about.
Nothing. As in nil, nada, zilch…
But we don’t have to follow Goldman’s artificial psychics. You can get some potentially essential clues about wanton only by looking during a chart. And right now, it looks like we’re environment adult for *gasp* aloft oil prices:
Crude fast ripped adult toward $60 after bottoming out in March, where it’s remained trapped for some-more than a month. But interjection to a good rebound this week we’re saying signs this beast is prepared for a subsequent leg higher…
And it also doesn’t harm that wanton oil inventories fell by 6.81 million barrels final week — a good small information indicate assisting to extract this rally. Lower supplies, aloft oil prices. Pretty simple.
I’m not removing into long-term forecasts here. We competence be looking during a few months here. But that’s adequate to palm us some sweet, West Texas gains.
Now stop profitable courtesy to a psychics and start profitable courtesy to a charts.
Courtesy: Greg Guenthner for The Daily Reckoning