This Is Why Jared Is Bearish On Oil Prices
Traders are closely watching the oil market crude oil prices tend to reflect the escalations and de escalations of tensions in the Middle East we have Jared Levy the chief Market strategist at Peak American Financial Group standing by hello Jared let’s get your Trader talk what’s your take on oil prices and Middle East tensions a lot of tension I realized that and a lot of that tension has been obviously priced into to the the net price of crude oil one of the things I’m noticing is that you know crude up here around you know $80 a barrel somewhere in there $83 a barrel is you know it’s kind of in line with a lot of what people are expecting and I’m I’m taking a little bit of a contrarian View today because you know I’m starting to look at again industrial production I’m looking at China’s sort of soft recovery spotty recovery I’m looking at uh you know air travel earnings I’m looking at the consumer and again this is just one of those things where if you’ve got a bullish portfolio overall and you want to layer in some some Hedges you know I’m I’m bearish on oil I I again I don’t think it’s it’s going to zero I don’t think it’s going to 50 um but I think up around the 85 area it’s just a little too hot that certainly could bring some relief to the gas pump where do you think crude oil prices are going from here uh and and frankly I think by summertime we should get down and probably see 70 to $75 at least in the Uso so there is a great ETF that trades Uso it follows the price of oil you could buy it and sell it just like a stock it’s currently trading around $80 or so $80.50 uh and what I’m looking at specifically is the July and sorry I’m looking at my notes 84 put it trades between $750 to $8 you could pay up to $8 for it if you want and my target on this is 11 now again it’s a nice way to get in there like I said Pay 750 set your target at 11 that’s a 40% % return and that option will easily get to 11 if the Uso drops down to 72 73 even 75 uh here in the near term any final thoughts on trading oil again remember OPAC plus I know they’re in control I know that they’re limiting Supply but remember these guys they got to pay that is the majority of their income for many of these countries um and you know Russia’s Cuts Russia doesn’t really account for that much remember the US is pumping heck of a lot of oil so again spotty on the demand side it’s been strongish but there’s been months where it’s not and on the supply side again steady which a lot of the summer driving season baked in so I’m looking for Uso to drop down to 70 to 75 before the summer but I’m by myself a little extra time and correction on that option I’m actually decided to go with the October 84 put the October 84 put buying it at 750 selling it at 11 a 40% potential gain again remember this is bearish on Uso I’m Jared Levy have a great day we’ll talk to you here soon thanks and thank you Jared go to business firstam.com for where to see our show on TV [Music]
Jared Levy, Cheif Market Strategist, Peak American Financial @jaredalevy
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