That’s what Barron’s opines this weekend, not that I have ever once listened to anything the paper has to say. Don’t get me started, but $5 bucks to read what Abbey Joseph Cohen has to say is $5 too much. The gist of the article however highlights something that I talked about in my March 15 post regarding oil. I posted my oil trader buddy’s e-mail, stating that non-commercial entities(dumb money) were very long oil futures. I mentioned that based on this, I was going short USO and caught an 11 point move down in the price of oil in about a week and a half. Bottom line the speculators were gunning the market higher.
To give you an idea of how serious the problem is, ETF’S, commodity pools and mutual funds(non-commercial) account for about 60% of all bullish commodity positions BUT looking at the smart money,farmers and folks who actually use the physical commodity, well, they have a net commercial short position about 30% higher than a previous record. I still don’t think the sector has even started to unwind yet
STILL SHORT – USO,GLD,PCU- will look to add XME next week