Given the recent unprecedented interest in trading WTI Crude Oil, Synergy Markets have released an in-depth analytical report to educate traders on the 5 key areas they should be aware of before they trade crude oil.
The key considerations the oil report talks about include:
- The History of Crude oil, and the WTI Contract. In order to understand what it is that’s driving the current market and recent volatility, skilled traders need to properly understand the history of the product, and the parties involved in the search for price discovery.
- What will happen over the next upcoming futures contract expiry? Should we expect a similar sudden erosion of value due to oversupply?
- Should traders try and take advantage of extreme market volatility caused by COVID-19 or sit on the side-lines until some kind of market normality is regained?
- The politics behind the contract, including the supply and demand issues and the technical.
- And finally, is buying and holding crude at these prices sensible?
In commenting on the release of the report, Head of Synergy Markets, Christian Dove said that the price of oil may fall significantly in the June futures expiry and advised clients to trade cautiously.
“I know many retail customers out there are desperate to benefit from what they see as huge opportunity to trade crude oil at these low prices. However, I advise – if you intend to trade oil, then please do so with great caution. I think we could easily see prices squeezed and more significant drops in to the next futures expiry – followed by a significant rally as demand re-ignites and as the current oversupply is exhausted and the inevitable lag for supply to be turned back on” said Mr Dove in a statement this morning.
Mr Dove further added, “To buy at these levels may risk being closed out on margin if prices drop a relatively small amount – so, if you have to, please trade cautiously and within sensible risk parameters”.
To get your free copy of the Synergy Crude Oil Report please visit their website.