Oil Over $100, Buying USO

We've not expected oil to go higher, however it's now over $100 and a push above a key level such as the $100 mark requires interest and action on our part.

Here's the chart:

The downtrend, in green, is not yet broken, and more overhead resistance remains at previous peaks (roughly $110 and $118), but we'll speculate on oil continuing higher via opening a long position in USO.

We'll give this one a long leash, placing stops below $29 closes.  For USO to get that low oil will probably have to be below its 2011 and 2012 lows, which is to say below $80.

Options traders might prefer the USO January 2015 $36 calls, last traded at $3.55 


Even the best make big mistakes, resulting in big losses: Einhorn's Greenlight fund hit by gold price drop.

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