Crude Oil $CL_F — “Numbers don’t lie, People do”

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I know… it may only be a one day event. So that being said— why not talk about it for a moment, since the futures are still not even closed, and hit a new high since 1:30 settlement.

Yesterday I posted dumbfounded regarding “Why isn’t CL rallying?” –

Well—- I guess the answer is, because “although maybe it should have, it seemed best to squeeze out the last weak shoestring longs in the market maker eyes rather than just give all the retail day traders the low hanging fruit! *Well— if you were patient enough, managed your risk, weathered the storm, maybe even got lucky, YOU may have caught the BEST DAY IN OIL SINCE MARCH 2009.

Front month Crude Oil settled @ $42.56 a barrel +$3.96 or +10.3%! There was not a better performing market to be in when it comes to any future product today. —So that being said, Crude Oil just had its best day in the last 3 years. And, anyone who has been following markets or specifically trading Energy this past year and a half can tell you; This has been the worst streak for Oil in over 30 years, last year alone was a record breaking move!

As I mentioned twice as I wrapped up yesterdays Blog post “WHY WOULDN’T CRUDE OIL CL BE ABLE TO EVEN END IN THE GREEN, LET ALONE UNCH?”. – I guess the answer was, it was setting up for today.

After the crude oil stocks unexpectedly fell by more than 5 million barrels last week, data showing inventories in Cushing, OK, declining.. And specifically the API and EIA we had yesterday (which we shake and baked off of capitulation lows)… All of a sudden it seems like the “numbers don’t lie, people do” saying is kicking into traders minds when it comes to “how they are going to TRADE Crude Oil going forward.” People kept talking about supply, but I think this for a moment, at least, in the last 24 hours, the bearish sentiment is certainly being tested by the historically strong and aggressive oil bulls moving prices in a record fashion. It helps that: *(the thought of diminished crude supplies mixed with stocks bid back up, copper recovering, I saw coal stocks up stupid amounts, even the aud/cad/nzd were higher today with a stronger USD).

Just as many retail traders came out yesterday and decided to play their hand at “short market maker” or I mean sell a stock or market short, the stocks ripped their faces off in a record way. I was wondering WHY Crude Oil CL wasn’t participating yesterday as the Dow rallied 600pts, —but we find out today, that it was setting up to set its own record! The traders as of late are used to a Crude Oil, where every rally, even .38 bounces higher are slammed lower, but today, the bulls brought a record short-covering surge against the bearish traders.

I will close with the same exact closing I did yesterday, hey why not, it worked, but although I think long term we could bid higher, I know nothing, and I will be active and trade it accordingly. I do not give investment advice, I can just say my opinions and give you an idea how I am looking at things. Right now let’s say I am or were to be long, I would bet I own some puts for protection and BP/Margin effects, since we are moving 10% swings in a day… but at least it’s higher if you are bullish :) — and it’s not over, (they are futures), better now than over a sketch thanksgiving holiday break…

So, now where does CL go tomorrow? What will make it move? Take a look at the futures at 5pm and let’s figure it out.

Let’s try again tomorrow. – Happy Trading.

-Bret Rosenthal