Monday, November 16, 2015

We Focus On Oil But Should Be Watching Sugar

While Newton's first law of motion applies to crude oil - an trend in a state of uniform motion tends to remain in that state of motion unless act upon by external force, it doesn't mean the invisible hand is aggressively betting against it. The invisible hand 'attitude' towards oil is neutral at worse. Strong bearish setups in 2011, 2013, and most recently in 2014 told smart money to bet on lower crude oil prices. A similar setup exist in sugar today, but the majority still focuses on oil.

Headline: Is Crude Oil About To Plunge Below $40?

In my last crude oil update, I discussed how the “smart money” was still betting on the lower crude oil prices, as well as the risks posed by renewed U.S. dollar strength. Since then, both WTI and Brent crude oil have fallen back to their late-August lows as the global crude oil glut continues to worsen. If crude oil is able to push decisively below $40 per barrel, oil at $30 per barrel or even lower is a very real possibility.



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