Why Oil Prices Are Headed Lower

The video discusses the current state of the futures market, highlighting the mixed signals from various risk assets like the S&P 500, 10-year notes, copper, and crude oil. It explores the divergence between stocks and commodities, particularly during the trade war period. The analysis focuses on crude oil, noting its market trends and volatility. The video concludes with options strategies for crude oil, emphasizing a bearish outlook and the importance of understanding market dynamics.

What was the performance of the S&P 500 E Minis over the last quarter?

• Down 1.2%

• No change

• Up 1.2%

• Up 2.5%

What is the main concern regarding the divergence between the S&P 500 and the Bloomberg Commodity Index?

• Stocks are falling while commodities are rising

• Both are moving in the same direction

• Commodities are outperforming stocks

• The separation indicates mixed economic signals

What is the key resistance level mentioned for WTI crude oil?

• 40

• 50

• 60

• 70

What strategy is suggested for dealing with the volatility in the crude oil market?

• Short calls

• Long puts or put spreads

• Short puts

• Long calls

What is the potential downside target for crude oil according to the analysis?

• Above 70

• Below 50

• Around 55

• Above 60