Oil’s Slippery Slope

Published on
November 26th, 2018
Duration
12 minutes


Oil’s Slippery Slope

Trade Ideas ·
Featuring Tony Greer

Published on: November 26th, 2018 • Duration: 12 minutes

Tony Greer of TG Macro takes a tour of the oil market and explains the recent implosion in prices. He analyzes this historical move, reviews how we got here and projects where we’re headed, in this interview with Brian Price. Filmed on November 20, 2018

Comments

  • CM
    Carlos M.
    3 December 2018 @ 08:49
    Leyt me be the first to say well done TG, I still dont see any correlation with any the reason you mentioned but still a win is a win.
  • MZ
    Martin Z.
    30 November 2018 @ 07:36
    Seriously wrong on the macro IMO, and regardless, trying to catch a falling knife. One of his two trades (the "better" one) is almost hitting his stop loss only 10 days after this interview is dated. That's the bad news. The good news is his stop losses are tight, so he isn't going to lose too much money. I think Raoul is much closer to the mark here with his much broader macro perspective , although oil may not drop all the way to $20. But it won't need to, it's already signaling a recession in 2019 and at risk of blowing up a lot more producers (and traders) on the way.
    • CM
      Carlos M.
      30 November 2018 @ 14:56
      but that is a mistake in itself, using tight stops when you haven't even seen a bottom forming, is almost a sure way of loosing money in any trade you do.
  • JL
    Johnny L.
    27 November 2018 @ 13:56
    I do not trust consumer confidence as Tony does for gauging a bullish market bias. What do these polls know? Hillary was supposed to win by 85:15. Consumers can not be that sure on real hard data. Most of them do not have any savings for an emergency. Who are the pollsters talking to? Maybe they believe POTUS promises for wages and jobs materializes but there is little evidence of that and I bet CC numbers plunge very soon. Otherwise an interesting discussion but I will not go long energy on the arguments until proven and than there is a lot of room to run higher after some confirmation.
    • EF
      Eric F.
      28 November 2018 @ 18:46
      Couldn’t agree more Johnny. CC looks like it is peaking / peaked, but is built on foundation of sand. I appreciate Tony saying it typically takes 12-18 months after peak for recession but this bubble of bubbles is anything other than typical. ZIRP has distorted the markets and the longer is goes - too long already - the quicker and more violent I think any snap-back can be. I like Tony, but I think now is more the time to just wait personally.
  • BC
    Burton C.
    27 November 2018 @ 05:49
    All sounds great, but I am waiting for lower levels rather than catching the falling knife. The last 2 recs were mental. Short gold... seriously... and go long FCX??? That was a trade which didn't understand the world wide slowdown.
  • RP
    Ryan P.
    27 November 2018 @ 00:13
    Nice job Tony. I played the NG trade in the levered space 2 weeks ago ... but that’s a whole other animal in itself. Will look to get involved this wk. What are your thoughts on GSG ?
  • IO
    Igor O.
    26 November 2018 @ 19:45
    Is selling 60 days out CL puts here a good idea?
    • TG
      Tony G. | Contributor
      26 November 2018 @ 21:55
      I don't like selling puts as a general strategy.
  • DM
    Dan M.
    26 November 2018 @ 18:44
    Agree, all this talk about a glut is complete BS unless there is a tremendous slowdown in the global economy which doesn't seem likely before at least 2020.
  • KJ
    Keith J.
    26 November 2018 @ 17:52
    An alternative view from Raoul: https://twitter.com/raoulgmi/status/1065929676818968576?s=21
    • DM
      Dan M.
      26 November 2018 @ 18:47
      While anything is possible, Raoul seems to have been wrong about oil for quite some time.
  • HO
    H2 O.
    26 November 2018 @ 17:33
    Disagree with the outlook for the S/D balance into H1 of next year. Prices may have overshot on the downside a bit, but if current production forecasts for the next 3 quarters are within a reasonable error, seems to be limited upside for prices until maybe the start of Q2.
  • FA
    Frank A.
    26 November 2018 @ 16:39
    Wrong macro call. Consumer Confidence as an indicator of anything ...I'm not buying
    • EF
      Eric F.
      28 November 2018 @ 18:47
      Yup, totally agree.
  • SS
    Steve S.
    26 November 2018 @ 14:16
    I'd rather wait for Oil to bounce and then short the bounce. I believe it to be a more lucrative trade.
  • CM
    Carlos M.
    26 November 2018 @ 11:28
    the us economy is humming??..sure ( reminds me of kudlow just before the last crisis).... maybe it is just me but all I hear is a lot of uncorrelated facts building a story that doesnt make sense... his trade might works purely on technicals but def not for me. if you missed shorting oil, dont try to make it up by catching a falling knife.
    • TG
      Tony G. | Contributor
      26 November 2018 @ 14:59
      PMI above 55, a consistently improving employment picture, and decade high confidence numbers tell the story of a strong economy. That's humming. If you don't like the opportunity of trading historic commodity pullbacks then this probably wasn't a trade idea for you. Good luck in the markets Carlos.
    • JR
      J R.
      26 November 2018 @ 17:11
      PMI trajectory is decreasing from August highs, while oil down and red October should reflexively hit the November and subsequent prints. Building permits (the best leading indicator) have peaked, declines in business surveys, rise in jobless claims, fiscal relief fading but UMSCI still holding, as pointed out. Wouldn't say the trajectory is to the upside, although much better than anywhere else. Thank you for sharing your thinking on oil though, great contrarian thinking. I guess you are expecting cuts to be announced at the December OPEC meeting and some kind of a truce from the Buenos Aires meeting.
    • CM
      Carlos M.
      27 November 2018 @ 13:53
      Housing has softened (mortgage aplications had 8 weekly declines in the last 3 months ), mortgages debt of $9 T and Consumer debt are at all time high in a rising rates environment, , Atlanta fed reduced GDP estimates to 2.5% for the 4Q (growth is slowing globally as well), philly fed headline index plunged! and six month forecast activity index is at a 2 y low. retail sales are showing that the impact of tax cuts continued to dissipate in october... honestly if you dig a bit deeper than PMI you can find plenty of data to support a slowing growth both in the US and globally. Good luck to you too in the markets, I have the opposite position on both NG and OIL ( guess someone needs to provide the liquidity ) time will tell who was right.
    • MT
      Marcin T.
      28 November 2018 @ 09:24
      I think his trades will be stopped for sure very soon , oil going lower
    • EF
      Eric F.
      28 November 2018 @ 18:50
      And all fuelled by tax cuts (unsustainable) from a base of decade long near zero rates (unsustainable) and record debt levels (unsustainable). Sorry, that’s not my definition of a strong economy.