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Oil on "long term spiral to the downside"- NYMEX oil trader

Friday, December 12, 2014 - 03:57

Investors should be careful in picking a bottom amid falling crude prices. Chicago Energies' Peter Amandio says oil could fall sharply from current levels around $58. Bobbi Rebell reports.

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More downward pressure on the energy market oil has broken sixty dollar threshold for the first time. In five years joining me from an IMAX is Peter on the idea he is an energy options trader down there nice to have you. Thank you are so put this downward move in oil and context what is it that light on the trading floor down there. Well I mean it's it if you look at charts it's pretty much expected if you look at the long term charts of weeklies month lease and once we broke through certain levels for instance like 250. And heating oil. Once we broke through those levels that opened up a whole new long term area to the downside. Now if you've spent in the business 25 to thirty years I know this might sound crazy but it's still somewhat of a high price. Well yes but it that we haven't seen it now while we did have today that International Energy Agency report. Pointed to a war downward pressure how important was that report to the downward move today. Well I I don't know how important the report was because it's pretty much a known fact that we don't see anything happening. In terms of fundamentals. To change this or turn this around. So I was for others that I always bring up the point that 2009. We pulled back to 33 dollars after being in a 142000. And it. Now that was width. Out North American shale and with figured demand globally. And demand from China so this is a whole new world how do you put on that it contact him weird does that take oil prices going forward then. Well like I told him. In 2009 we pulled back to 33 dollars she got to be careful being a bottom ticker at these levels. But also you have to keep in mind at any time something can happen geo politically for it to take its back head back up our that's always the case how would you. How do you play this market. Played from the shorts I'd play it. I from a technical basis every time you go see it go up on a daily chart so good area to solid again salad again. Because where is all the volume. The volumes and panics a loss to the downside. And until we break certain levels technically on a daily chart I don't see it turning around. And unless something happens. Globally with demand I don't see turn around so that wears the floor this morning. Well. Right. I think you got to be very careful picking a bottom. Because if you look at the past and look to history. Of when it's made moves from the plus 100 dollar area backed down where's it gone it's gone down a 33 last time. So. I I can see it softening up from here impossible so. Is there any catalyst any any trick any threat tipping point that would create a floor or you just you see it as it. Long term downward spiral that sleazy 33 dollars is that what you're saying. I see a long term spiraled to the downside but. I'm saying long term when I was talking fifty dollars when we're in the ninety's it was only a matter of weeks ago. So if you're better in the commodities world for a long period of time usually when we fought a long term basis it happens much quicker than and you thick. So we could fall hard and we could fall very quickly. Well and OPEC in this taking a very measured approach what are you hit what's your what's your sense of that are they gonna change at some point soon. I don't think so and when we were 85 dollars and rent. They thought to rent was worth eighty dollars why would they say that. Because they wanted to see lower energy prices to get their competition out of the market I think which was North American champ. All right we're gonna leave it there thank you so much you're welcome our thanks to Peter out idea he's an energy options trader of at the nymex and I've never felt this is writers.

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Oil on "long term spiral to the downside"- NYMEX oil trader

Friday, December 12, 2014 - 03:57