USO Breaks Upward Trendline…Finally

The moment that many investors, and all consumers have been waiting for has finally come, the possibility that oil could finally be topping out. Today the United States Oil ETF (USO) broke its upward trendline that was set back in February.

In order to hold the February trend, USO would have needed to hold the $110 mark. Whether or not this will lead to a significant drop in oil, or a sideways trading range remains to be seen. Either way, the break of this trend puts significant doubt in investors and traders that the rally in oil can continue.

The best way to play a potential drop in oil is the MacroShares $100 Oil Down ETF (DOY), which tracks the inverse price of crude.

Comments

[2-cents:]

How many chartists actually make money in the market?

2008 Jul 17 03:04 AM

[mangolfer:]

I started investing in DUG on Tuesday. I've made a ton of money in 2 days with oil dropping. Timing is everything....

2008 Jul 17 06:40 AM

[morgan77:]

DUG is the way to go right now. With crude and nat gas perhaps finally topping out, momentum investors will be sacred away. This means the price will continue to lower. Add to that that value investors are slower to jump in, and instead wait longer to see further drops, DUG could be huge over the next few weeks. Interesting podcast on the whole phenomenom psyche of it here: www.greenfaucet.com/sh...

2008 Jul 17 12:56 PM

[Etf Planet:]

DUG is also a good choice, I agree

2008 Jul 19 10:55 AM

[mangolfer:]

The news they use to support oil prices is the same everyday, the global demand for oil is dropping everywhere, the trend line has broken, the car and airline companies are losing their ass, supply is way up, the government is about to get involved to hang somebody over the pricing.... Not sure what else can be said, it's gotta go down!! DUG is a good buy!

2008 Jul 20 09:14 AM