Put options on U.S. Oil stock.?

Question

Has oil peaked to the highest its going to get this summer? Is now a good time for buying put options on U.S. oil? I'm interested in getting put options that expire in September.

Answer 1

Who knows.  I personally think it will stay high through the summer and start to fall towards the end of summer.  It's basically a gamble at this point.

Answer 2

Certainly its possible, the problem is the trend lines on oil futures still remains firmly in an uptrend. Trends in the market don't typically break overnight, but only after several days of institutional investors dumping positions. So, until that time comes, the assumption has to be that oil continues higher. I agree, a top is near, but investors have been losing their shirt trying to predict the top first at 80, than 100, 120, 135, and now 150 or 200?

You can take the position, since its an option, you have limited downside risk, but until the trend is broken, I'd anticipate this to be a losing trade.