Oil in on parabolic move

I have been betting on a mini crash of the oil/energy sector right now but it is not yet working. Actually oil is on fire and has gone vertically up nearly everyday. Well the more it goes up from here, the more bearish I become on it and I'm willing to add more of my short positions on it. Apparently I'm not alone on this thesis. See below an analysis I have seen today. I obviously don't know when the parabolic move for oil will turn around but with a small risk, I'm willing to bet for a potentially huge return if it's finally pulled down by gravity! Be careful about FOMO on oil🙄

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The price of oil has gone parabolic.

Oil traded as high as $130 per barrel overnight. It has since settled back to $123. That's 33% higher than where it was last week. Oil is up about 65% so far in 2022.

This is a panic move. It's parabolic. And, it's unsustainable.

Think about the price of lumber last May. Or the price of natural gas last October.

What we're seeing in oil right now is the exact opposite of what happened in March of 2020 – when oil was trading at $30 per barrel one day, then just one week later it was at minus $30 per barrel. That was an unsustainable move to the downside. The price recovered 100% of that decline in about two weeks.

Once this parabolic move ends, and no one can say for sure when that will happen – though we're probably quite near the end, we're likely to see one heck of a move to the downside. And, to the extent that rapidly rising oil prices have affected other securities, other markets should reverse as well.

It is important, if you're trying to trade in this environment, to recognize how emotions will affect your trades. Lots of folks are rushing into oil (and other commodities as well) right now, chasing prices higher into extremely overbought conditions, out of fear of missing out (FOMO). That's probably not the strongest foundation on which to place a trade. It's like buying shares of Gamestop (GME) last year as it surged above $350 per share – on its way to $480-ish. One week later, the stock was below $60.