Save it for Later

My USO long (noted in real-time with both Members and in this blog post back on June 25th) has given me some decent profit cushion with the latest push higher in oil. Thus, since I like the way oil stocks are beginning to firm up, I just went long the high beta and controversial oil services play, Transocean (RIG), betting on a short squeeze higher before earnings on August 5th. 

With oil, rallying RIG has a short percentage of its floats (shares outstanding) around 22%, an extremely elevated number. If oil bears are wrong here, then RIG is ripe for a violent squeeze higher back above its 200-day moving average. I would look to cut the long somewhere below $4.70, most likely. 

But with this oil rally beginning to silence, or at least humble the vocal oil bears both on Wall Street and inside the Beltway, I want to place my bet that the dynamic has shifted from May/June and a protracted war with serious supply disruptions are nothing to be taken lightly.