SENTIMENT IN OIL IS STILL TOO BEARISH

sentiment in oil
Even after an 85% rally, sentiment in oil is only at 37% bulls. Everyone is stuck in the so called “fundamentals” and they still can’t see that the fundamentals have already reversed. Before this rally is finished we are going to see excessively bullish sentiment and oil will test $60. Sentiment in gold hit 73% last week, oil should at least match that before topping.
sentiment in oil
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26 thoughts on “SENTIMENT IN OIL IS STILL TOO BEARISH”

  1. shine07

    Was not $50-$55 the initial projection for this move?

    In my mind $51 will mark a medium-term top (w3 like). Later in the year, probably, we will go from $40 to $62 (w5 like).

    1. Gary Post author

      Maybe a daily cycle top at $51 but I doubt the larger intermediate cycle tops until $60 or higher.

    1. Gary Post author

      That is short term sentiment. Yes in the very short term oil is getting stretched above the 10 day moving average and will need to consolidate or pull back a bit. I’m not a day trader though so those kind of extremes don’t factor into my trading strategies.

      The intermediate degree sentiment is still too bearish.

    1. Gary Post author

      I’m really not sure what that chart is supposed to show.

      Nothing has changed IMO. All asset classes have completed multi-year cycle lows. Sentiment in gold got a bit too bullish and it’s going to need to cool off a bit. I expect it will do so as the dollar rallies into the Brexit.

      Eventually oil will get too bullish as well and then it will need to cool of also, but it still has plenty of room to rally yet.

  10. Don

    Dennis Gartman has turned bullish on gold and oil . I sold all my oil positions immediately and will stay out of oil until he flip flops back to bearish. Today, he flip flopped back to bullish on equities so I feel much better about being short the S&P.
    I have followed Gartman for as long as I have Gary and I will put my money on Gartman being WRONG. That clown’s his track record is as close to being 100% wrong as any ‘analyst’ I have ever seen in my 38 years of investing. (aka, gambling)

  11. Alexandru Popovici

    to ROZELINA17:

    Both yes and no. There are no magic solutions in trading. There is only a magic structure regardless of your chosen trading scope and horizon: design a trading strategy/plan that fits your personality to include RULES on all 4 dimensions: risk management rules, entry rules, money management rules and exit rules.

    Some of these rules overlap the 4 dimensions, for instance selling when the stop loss order is hit makes both an exit rule and a risk management rule.

    Fundamental to developing such a plan are for you to understand two principles:
    1) trading is a probability game with positive expectancy (brother with poker, blackjack) and each and every of your entries MUST BE REWARD-RISK-WISE, i.e. you should not search for buying cheap but for buying an asset AT A MOMENT when it may provide you a reward representing a multiple (usually 2 if trading stocks and in general assets with ATR THIS INERTIA IS THE MAJOR OBSTACLE TO TRADING.

  12. Alexandru Popovici

    to ROZELINA17:

    Both yes and no. There are no magic solutions in trading. There is only a magic structure regardless of your chosen trading scope and horizon: design a trading strategy/plan that fits your personality to include RULES on all 4 dimensions: risk management rules, entry rules, money management rules and exit rules.

    Some of these rules overlap the 4 dimensions, for instance selling when the stop loss order is hit makes both an exit rule and a risk management rule.

    Fundamental to developing such a plan are for you to understand two principles:
    1) trading is a probability game with positive expectancy (brother with poker, blackjack) and each and every of your entries MUST BE REWARD-RISK-WISE, i.e. you should not search for buying cheap but for buying an asset AT A MOMENT when it may provide you a reward representing a multiple (usually 2 if trading stocks and in general assets with ATR THIS IS THE MAJOR OBSTACLE TO TRADING SUCCESSFULLY.

  13. Alexandru Popovici

    to ROZELINA17:

    Both yes and no. There are no magic solutions in trading. There is only a magic structure regardless of your chosen trading scope and horizon: design a trading strategy/plan that fits your personality to include RULES on all 4 dimensions: risk management rules, entry rules, money management rules and exit rules.

    Some of these rules overlap the 4 dimensions, for instance selling when the stop loss order is hit makes both an exit rule and a risk management rule.

    Fundamental to developing such a plan are for you to understand two principles:
    1) trading is a probability game with positive expectancy (brother with poker, blackjack) and each and every of your entries MUST BE REWARD-RISK-WISE, i.e. you should not search for buying cheap but for buying an asset AT A MOMENT when it may provide you a reward representing a multiple (usually 2 if trading stocks and in general assets with ATR THIS IS THE MAJOR OBSTACLE TO TRADING.

  14. Alexandru Popovici

    sorry, for some reason my message is truncated. maybe because it is too long 🙂 🙂

    Fundamental to developing such a plan are for you to understand two principles:
    1) trading is a probability game with positive expectancy (brother with poker, blackjack) and each and every of your entries MUST BE REWARD-RISK-WISE, i.e. you should not search for buying cheap but for buying an asset AT A MOMENT when it may provide you a reward representing a multiple (usually 2 if trading stocks and in general assets with ATR THIS IS THE MAJOR OBSTACLE TO TRADING.

  15. Surf City

    Gary, GDXJ and many other miners making new highs today. Can you find another example on the charts where the Miners were making new highs like this 24 weeks into your Intermediate Cycle on Gold?

  16. Surf City

    SPY dropping like a Stone now. I have short positions in SDS, QID, and BIS plus some June Puts on AAPL.

    (Also a small position in UVXY, the “Widow Maker” from yesterday)

    2030ish on the SPX is critical here, IMO. If it is going to bounce, that would be the spot.

  17. Dave

    The longer it takes equities to make new ATH’s the higher the odds the market will continue to make weekly lower lows.

  18. Alexandru Popovici

    He who refuses to read Lady Market’s continuous signs that we’ve still been in a stocks BEAR shall bear their ignorance into the value of their trading equity, if anything material is left of it.

      1. Surf City

        Gary, I have resistance at $51 as well and am long several producers including BHP and STO in my IRA. I may keep them as they both have a nice dividend stream at my entry point. My hedge would be to short oil with SCO only if /when we break the IC Uptrend line.

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