What a short 6 weeks period can do to traders mood! Here is what I said 6 weeks ago here: Currently the herd mood is very depressing for oil and I have seen a lot of talks that oil will go down further from here. Considering oil is drastically oversold with depressing sentiment at the moment, a rebound is much likely than an immediate big leg down. But any meaningful bounce should be short lived. Don’t be fooled by the dead cat bounce! It was a spot-on perfect timing of the call as oil almost immediately started to rebound. You would think that people should at least have some memory how depressing their mood was just a few weeks ago and they should think twice if they wanted to change their mood so quickly. Nope! Just like a schizophrenic patient, their mood has 180 degree shifted without hesitation, from extremely depressing to extremely euphoric now within 6 weeks. Such an extreme move will trigger another shift soon, if not immediately!
If you bet for a short oil rebound as I did, then now is the perfect time to take your profit. Any further rise for oil, if any, should be very limited. I think next big move will be downwards. I don't know if this time will push it down to below $40 but I won't be surprised to see low 40s again soon. Aggressive traders can think about SCO to bet for a down draft of crude oil. It is just like a clock pendulum moving from one extreme to another every few weeks. Take advantage of this predictable trading opportunity.
Trend in FII flows: The FIIs were net buyers of Rs -199.21 the cash segment on Monday while the DIIs were net sellers of Rs 308.15 as per the provisional figures.capitalstars
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