Okay, so WTF happened with $CL today?
Here's a thread with my best guess, although there's probably something huge I'm also overlooking.
1/x
#OOTT #COM h/t
@Josh_Young_1
@Josh_Young_1 There was a lot of news coming out today, first with inventories reported by the EIA at 10:30 ET.
Oil showed a build in key inventories like raw crude, diesel, and gasoline at 10:30. The market handled that well-- it was roughly inline with other numbers last night (API).
2/x
@Josh_Young_1 Bulls have been focused on oil unloadings in China and global inventories, while bears have been focused on OECD demand and US balances.
However, it's shoulder season, and there were no terrible surprises and the oil market handled things well for an hour.
#COM #OOTT 3/x
@Josh_Young_1 But a little after 11:40 ET, we saw a significant $CL selloff on volumes.
Perhaps there was some news or a forecast that came out. But another explanation that might have helped drive that: heavy speculative positioning into a macro event (FOMC).
#COM #OOTT
@Josh_Young_1 According to data published weekly by the CFTC (COT), there's been a lot of bullish positions on oil recently. And the FOMC is an important macro event that many traders try to get out of the way of.
If oil bulls derisked into the Fed, that might explain 11:40 ET.
#COM 5/x
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