ProShares Ultra Bloomberg Crude Oil 2X ETF (UCO)

[kiy]

Stronger dollar...that's interesting...how long will this last...?...
GOooooooooooooo Janet...
My Hero MRS Doubtfire...

Strong dollar...oil below $100 and shorting the high flyers...Biotech and Social Media...
Dollar UP...oil and gold down...


So if oil has another leg down this guy thinks there's buyers at $95 level...
http://wallstcheatsheet.com/business/oil-prices-are-under-pressure-is-it-time-to-buy.html/2/
So we have several candidates that could be driving prices lower. But is it now time to bet against this downtrend on higher oil prices? While we may not have reached a bottom, it seems that the oil price is looking to start an uptrend, and we have seen very strong support earlier this year in the mid-$90/barrel range. I suggest that if you are interested in taking a position in oil that this level would be a good place to enter. There are definitely bullish arguments for oil, despite the bearish arguments that I have pointed out above.

First, with respect to my first point, the bullish speculators are exiting the oil market and many of them are likely taking bearish positions. We can easily see the speculators get overextended on the downside and they could be forced to cover their shorts and cause a short squeeze.

Second, while geopolitical tensions have retreated from the headlines we have to be concerned about potential shortages if tension between the U. S. and Russia escalates, or if internal tensions escalate in Iraq. It is better to bet on these sorts of things while they are temporary off the front pages than when they are sending prices soaring.

Third, while the Fed may be stopping its quantitative easing program it still has interest rates at near 0 percent, and this is highly inflationary. We have already seen signs in the first half of the year that inflation is picking up, and I suspect that this will continue. High oil prices last month could impact the CPI reading, and this could spark bullish oil speculation.

Given these points oil and oil-related equities are starting to get interesting, and I would be looking to take a position, as I said, if oil reaches the mid $90/barrel range. Investors should consider the aforementioned XOP given its strong performance and its high correlation to oil. Investors looking for a trading position should consider the United States Oil Fund LP (NYSEARCA:USO), which tracks the oil price. However, given that this fund has several expenses, it doesn’t track the oil price well over the long-term, and so it is a trading vehicle.