i think if you are trading something like USO, you have to use technical analysis...there are no fundamentals to evaluate USO like you would a company, and while you may think OPEC or peak oil or something else will cause oil to rise in the long run, and you very well might be right given enough time, the short term swings can be brutal
another thing to note with USO is that unlike the spot price of oil, which currently rises every time a contract expires, due to the contango in the subsequent contract, there is no contango in USO, so while the spot price of oil is still above where it was a few months ago, the price of USO is well into new low territory
crude hit a low of 55.81 in mid november, and USO hit a low of 50.25...now crude is dropping below 57, but USO is 4% lower than mid november, so while oil would appear to be a bit higher than mid november at this point, a person who bought USO back then has lost money
JMHO of course |
