Now Is the Time to Buy Crude (USO, XOM, PTR, BP)

oil etfsJust as we are beginning to see glimmers of hope that our economy may finally be healing itself, I can’t help noticing the concurrent indicators that suggest how screwed-up things have gotten over the past few years. Specifically, that we have become so leveraged to this whole Bernankafied low interest rate, artificial stimulus machine, that the only way forward from here is to ensure that the dollar stays weak and Treasury yields remain in the toilet.

The past month has been a perfect example. The dollar mounted a strong comeback versus the Yen, Euro and collectively as the Dollar index at a time when commodity prices were constrained and Treasury yields jumped back to their yearly highs. In the case of oil, a 5%, 1-month decline in crude has brought value back to this market in the eyes of some investors.

“At this level, this is a trade,” says Bill Baruch, market strategist at iiTrader in the attached video. As he sees it, crude is at the low end of its range, having touched $100 and slipped to the mid-$80s. “This is when you want to step in and buy,” he says, noting “the limited downside ” and bottom part of the range. On a macro economic level, Baruch says there has been no shortage of domestic data to encourage investors to buy, and even more so on a global level, which he characterizes this way.

You can see the full “Breakout” interview below:

Related: Exxon Mobil Corporation (NYSE:XOM), United States Oil Fund LP (NYSEARCA:USO), PetroChina Company Limited (ADR)(NYSE:PTR), BP plc (ADR)(NYSE:BP)

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