to buy Russia (RSX). More on that in a second……
First, there are a few things telling me that the oil bottom might be quite a ways off and some people might not even believe where it finally bottoms. What makes me say so? Well, everyone is looking for the bottom. That typically suggests that such a bottom is no where near today’s levels.
Case and point…..
- Standard Chartered: Brent at $70-$75 by year end
- So yes, the oil crash looks a lot like subprime
- Cramer: Oil could go to $10
He said the bank expected oil prices to rise between $70 and $75 a barrel by the fourth quarter. He said that projection already took into account the entry of Iran, which Standard Chartered estimated would add 400,000 barrels a day in global supply.
Perhaps. If we study structural or long-term bottoms in the stock market or commodities we notice one thing. When they arrive, most investors are nowhere to be found. First, they are so utterly disgusted with the asset in question, they wouldn’t touch it with a 12 foot pole. Obviously oil is nowhere near that point.
Second, no one would be looking for a bottom as most investors would believe that the underlying class would never recover. And with every day trading grandma trying to time the oil bottom, that is obviously not the case with oil today. Perhaps Mr. Cramer is right and oil will have to go to $10 or lower, no matter how crazy that sounds today, before some sort of a structural bottom is put in place.
With that in mind, buying Russia as a whole might be your best bet here. Of course, when the time is right. As was outlined here Is It Time To Buy Russia (RSX)?
