V is near a break. The next support is 75... I doubt it will dip past 70, but if it did, i would buy a few and scale from there.
Typically Memorial Day is when the annual demand for oil happens, coinciding with travel. That is what history says anyway... My only oil position includes 2 USO calls one in the money and one out.
USO, it will definitely be volatile as uncertainty exists:
1) The earthquake in China has caused questions regarding their demand for oil. At the same time, disasters in themselves cause demand in oil with the need for rebuilding infrastructure and the like. Plus, they are still having the Olympics.
2) Will they still cut rates? Doubt it. Then again who knows. The weak dollar is what has really sent Oil/Dollar ratio flying.
3) Travel within the U.S. may include families choosing to stay closer to home. So, questions of demand remain here as well. I must say there are still deals to be found if you want to fly. But they happen to all be in the Fall.
Some are already saying we ARE in a recession. Uh, yeah... we know that already. No one will be surprised to see all the stocks that recently broke to new highs get pounded. Remember, the charts basically show you whats going on. The big brokerages can only sell so many blocks at a time to maximize their profits.
My thinking is to watch USO carefully. and move it back to V if i find a nice entry. Banks are to be watched carefully as well, as they are off their lows. They may be a nice short.