During the months of January and February of 2009, average daily volume of this ETF was about 40 million shares a day. Previous 2008 average vol was about 15 million and April 2009 volume is back to about 15 million a day. The "accumulation" indicators I have available to me do not register any massive accumulation by "strong hands" during this period, but I have a gut feeling it might be so. This phenomenon does not appear in individual oil company or oil service stocks that I have looked at. Could it be that some oil futures players are treating USO as a perpetual option on oil?
I think you might not be looking at the big picture. USO is only a tiny piece of the puzzle, I suspect that the money flowing into oil futures is a better indicator of smart money allocation. USO is not an efficient way to invest in oil because it is capital intensive and the tax treatment is worse then for futures. So don't look at USO volume/price action as an accumulation indicator. -Neo
Funny you mention that. I just started using the USO as a hedging tool since its more liquid and cheaper commisions than buying options on the CL. Only problem is adusting number of shares to acheive the delta i'm looking for. Do you find accumluation idexes to mean anything? I find most TA indicators to be fun statitical games but have little predictive value.
accumulation is distribution is accumulation. All hocus pocus. Just because the level is low doesn't differentiate between accumulation and distribution. And agreed, the USO means relatively nothing in the oil market besides the occasional rollover bump it causes in real futures and the tiny incremental demand it adds to oil.