Just As The Data Gets Better, Everyone Is Turning Bearish
It wasn't long ago that everyone was bullish on oil. Bloomberg published an article noting the possibility of triple-digit oil prices this summer and we tweeted at that time that it was not a bullish indicator. Following today's "misleading" EIA oil storage report, we can see that the sentiment side has turned 180. Couple that with what we are seeing on the money manager oil futures positioning, we can safely say that the washout has occurred.
Source: CFTC, Giovanni Staunovo
The funny thing about the oil market is that speculators tend to always swing so wildly from one side to the next that you wonder just what's going on in their brains. It wasn't long ago that the conflict between Israel and Iran would send oil prices into the $100s only to not hear a blip about it now when prices are falling.
There's nothing like price-changing sentiment, but I'm here to tell you that the oil data is finally starting to improve just as sentiment bottoms out.