We will go on to discuss oil (/CL) but let's start with the general market (/ES / SPX) update briefly. In our previous post, we mentioned that we were surprised to see market tank down 2% yesterday morning. Because the market internals were poised for sideways/ bullish posture. Well, we were positioned short; we still are positioned short (ST/ IT/ LT) with trimmed positions.
Our outlook for 1-3 days (VST) was neutral/ bullish. The futures market (/ES) is up ~ 1% as of now. For the next 1 - 3 days, we remain neutral. We would not be surprised if we see /ES ~ 1980 one more time before driving south.
But, we remain flexible as always. Opinions do change with the market changes.
VST - Neutral
ST/ IT/ LT - Bearish
Previous oil update here (please see chart in this post)
This is where we stand today (chart below):
/CL rallied ~ 28% bottom to top. We do not have positions in /CL = none. But, based on our trading methodology, we would have taken 50% off the position on a good rally like that one. And ride the rest with the house's money.
The chart was obviously aimed at IT/ LT traders but if you score 25% profit in 3 days, would you say no? :)
Anyways, the outlook for oil is
VST/ ST - neutral = get stopped out while you are still profitable
IT/ LT - Bearish ( we don't see any change in the outlook even after the rally) until next turn