Crude oil continues to fall sharply. Our target is around $70 per share. If you were able to enter the Crude Oil DoubleShort ETF position, symbol DTO, you are sitting on open gains of up to 41%. That is a very nice open gain. We think it makes sense to lock in some of it with a stop-loss order.
We suggest you place a stop-loss on DB PW Crude Oil DoubleShort ETF, symbol DTO.
This should be a good-till cancelled stop-loss order.
Stop-Loss Level = 45.55 [Last Price 50.16]
Given an initial entry price of 35.04 on this position, the new stop-loss level represents a 30% gain.
As you can see in the chart below, if oil falls to near our $70 target price, DTO will be sharply higher…Crude Oil versus DTO Daily:
Thank you.
Jack and JR Crooks
Ed Note: David Bensimon in his interview with Mike on May 26th Money Talks had a view on Oil too: “My view back in the April report about Oil which is an even larger industrial commodity, that it would very precisely drop 14-15% from $103 to $89, which the first downleg of a slightly larger movement. It would be driven by the fundamentals of a removal of the risk premium of Iran, my expectation being that the Iranian problems would ameliorate and not explode as was being expected at that time. Also the technical elements were favoring a retreat, and as it turned out the Oil market did drop exactly that %15 from $103 to the low of $90 so far. My view here is that on a short term basis we could see a little bit of consolidation, but the general movement has not completed and I would be looking for a continuation to the low $80’s by around the middle of July as well”.
Read more of the whole David Bensimon interview with Michael Campbell HERE
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