In the flurry yesterday, I didn't get a chance to explain my bullishness for USO very well. There are a few reasons:
- When we turn around (and we will; whether it's today or three months from now, it is inevitable), I think energy is going to be one of the first leaders;
- For most of yesterday's vicious 300-point selloff, USO was doing an admirable job clawing its way higher or at least trying to hold on; you could almost see the "fight" in the chart during the day;
- Simply stated, oil isn't going away; you're never going to wake up and found that crude oil has been lying all this time that, in fact, it has no energy value; there is a store of value there, and there are limits to how far it's going to go down in price (and that limit is not $0)
I think it's got a clear ride to just under $28 at least. As for the contango issue everyone keeps bringing up, my sincere answer (and this isn't meant to be disrespectful) is simply this: don't bother me with facts; I'm a chartist.
