I did end up buying one at 2.06 sorry i didn't post the entry i was at target and i've been getting puked on by a 1 year old all morning. My plan is to sell it when we are at 98.50 on the front month so I guess that would put it around 2.55 to give the outright short time to work. Additionally if we get back below 97.30 for a bit I'll add another short contract but continue to hold the call because it isn't really hurting anything. Anything between here and there I'm just sitting here picking my nose and thinking about trying to short the euro again if we can touch the top of the channel.
I have been thinking about the pipelines from Cushing, and the general assumption that oil supplies at Cushing will be drawn down. Putting aside whether this is bearish or bullish, have you given any thought as to whether this will increase WTI volatility, or reduce it. I tend to think that with less supplies on hand, we would have more volatility, for two reasons. The first is simply that there will be less supplies to cushion the extremes. and the second is that if storage is easier and cheaper, more (time) arbitrage players will come into the market. Any thoughts? I figure this is would be a significant consideration in your trading.
That is a deep question for a bumpkin such as myself. I think we would have to see how refiners adjust to a change in the supply chain. They have already been kicking it up a notch so how much more can they handle? Seems like this would be more bearish for gasoline. Also at what rate is drilling at? I think producers on both ends will adjust and it shouldn't really be an issue as far as volatile price swings go in the long run. As far as volatility built into option prices I have no idea how this would effect that BlueStreak would know where the hell has he been? Fundamentals only matter when they matter. In a given week I would say fundamentals matter for about 2 hours :eek: