The collapse in the oil price has me concerned about the potential upside in the general market.
Oil is in the news, but more importantly to an investor, it is sliding off the chart. It will hit the bottom, but that will only be clear in hindsight.
The USO chart below is telling me to be very cash heavy for now.
Too much risk in the economy if oil can be this disliked. Just my opinion.
And if oil doesn’t do it for you, copper is really ugly as well.
The IWM is the only ETF I am trading at the moment. I am buying at support and selling at resistance. I do not need to understand the secrets of the economy to make that strategy work and pay the bills. I also use the TNA to get some leverage.
If the IWM achieves and stays above all time highs, I will build a larger position. For now I am risking little capital and cutting loses very short.
I may be wrong, but that is how I see it for now.