The way the curve is backwardated, it seems like market is expecting a prolonged move down. Though, i doubt the current front month is going to go below 90, but there seems good chances of it happening once the front expires and the second becomes front. Anyone got the move down? I was anticipating it, but couldnt time it at all. Expected it to go down on wednesday but it went down on Thursday, and after it didnt on wednesday, i didnt expect this at all on thursday xD, so just scratch . Currently trading only intra day so no chance. Also, does anyone look forward to crude spreads going into contango? The wti ones. I think the whole curve may be shifting downwards ,and in a couple of months we may actually see a contango in wti spreads, but i wouldnt bet on it -again the timing might be terribly off.
1) A repeat of ~2009 when deferred months were ~$20/barrel over the front month? 2) I would prefer a sustainment of the increased intra-day volatility and not carrying positions overnight and certainly not over-the-weekend. 3) Be on the lookout for any "chatter" about the flow of crude oil out of Canada and the Dakotas slowing down because the market is getting too close to their breakeven price(s).
Can you please elaborate a bit on the third point. Wouldnt it take time though like a few months for the market to adjust to any such change. Meanwhile I look forward to trading these new prices in oil, this contract xD. Will look to calendar spreads to touch contango sometime in oct nov maybe.
1) That supply can almost be shut off immediately. If such a "disruption" were to happen, CL can rally several dollars per barrel quickly. :eek: 2) It's more similar to applying the brakes on a truck instead of bringing a massive tanker to a complete stop.