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Not an energy expert by any means, but I dug into that huge HO/RB spread, and a news article said that there was a major refiner in the northeast that had to shutdown due to a fire. HO inventories may not be enough to serve the market until either the refinery comes back up, or they can get barges up the coast. RB inventories should be fine, hence the violent action in the spread.
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If I interpret this CME Performance Bond Requirement (aka margin) changes correctly it is saying that they are increasing the volatility scan ranges for most oil options effective after the close of business on November 15, 2018. ie Margin requirements for most Options will go up.
November and December 2018 I was buying the dip and I was bullish and quite sure that 58 on the brent will hold, then sure that 50 should hold and I used at a time for a short period up to 3 long futures in addition to my 3 naked put options to be successful.
The situation has changed or at least I keep in mind my Elliott waves (can be a wave 3 or can be a wave C with 40 -45 as objectives) and I am ready to intervene but I will be cautious because I do not have strong conviction this time. I have only a short spread put option at 58 - 55 so my potential losses in July are limited, but still...
The fundamental is weak as global growth is slowing and US production is high. There are rumors that some countries can still import some Iranian oil up to a certain and unspecified quantity. The WTI COT does not talk to me too much (no recent extreme, nothing remarkable). Of course the MM are decreasing their bullish positions.
So far I prefer trading the Brent than WTI but it is almost the same analysis anyway.
Any opinion, input?
Concerning NG it may be the time/will be soon the time to explore a slightly bullish option view for the end of the year.