(WCTW) History Is Rhyming
The checklist that will kickstart the multi-year oil bull market.
I think I've seen this movie before.
Crypto craze? ✔️
Market all-time highs? ✔️
ARKK making a comeback? ✔️
SPACs making a comeback? ✔️
But not just any SPACs, the king of SPACs, Chamath Palihapitiya, is launching American Exceptionalism Acquisition.
Energy is the most hated sector? ✔️
Everyone is bearish on oil? ✔️
OPEC+ increasing production? ✔️
Wait, this isn't 2021, it's 2025.
History doesn't repeat, but market participants love to repeat the same themes over again until they exhaust themselves. And I don't think this time is any different.
But unlike 2022, there are subtle differences this time around that warrant a checklist method to navigate through.
During the previous oil bear cycle, the COVID-led downturn made market participants believe that oil demand would never return. In a similar tune this time around, market participants think the supply side won't stop growing.
However, the supply response is different in oil, and unlike the COVID-led demand suppression we saw in 2020/2021, the dynamics are a bit more nuanced.
Let's dive into the checklist that will set off the structural oil bull market.