Fundamental Factors #9 Yi Zhan
Crude Oil Scenarios
1. Weather
Bearish
By checking and comparing the weather condition this week to next week in State College, PA, I found the temperature next week will be a little bit higher than this week. These data came from (https://weather.com/weather/tenday/l/USPA2267:1:US). The demand of heating oil will be decreased next week. So, I think it would be bearish in effect.
2. Domestic Economy
Bearish
By observing the Dow Jones industrial average index(http://money.cnn.com/data/markets/dow/), I found that the 5-day change is -0.50%. By check the Dow Jones industrial average index last year this time the data is 5.36%. The …show more content…
Most of the gasoline came from the crude oil. So, the crude oil’s price be increased as well. Due to the relationship between the price of gasoline and crude oil. I think it would be a bullish effect. The price of crude oil will be increased.
7. Changes in Inventory and Storage
Bearish
By reading the crude oil storage report(https://www.investing.com/economic-calendar/eia-crude-oil-inventories-75) on website, the forecast is -2.876M and the actual storage is 2.237M. The difference is 5.113M. The difference last week is 0.697M. They store crude oil more this week. The actual storage is more than forecast by 5.113M. The demand of crude oil will decrease because they already have enough and don’t need more. So, I think it would be a bearish effect due to it was more than they expected. The price of crude oil will fall.
8. Buy / Sell recommendation
By analyzing each of the scenarios above, my results are three bearish, one neutral and three bullish. I think the effect of bullish will overpass the effect of bearish. In one word, I will buy crude oil due to my future expectation about crude oil is bullish. The future price of crude oil will go up. Investors can sell them when the price of oil contracts
Crude Oil Scenarios
1. Weather
Bearish
By checking and comparing the weather condition this week to next week in State College, PA, I found the temperature next week will be a little bit higher than this week. These data came from (https://weather.com/weather/tenday/l/USPA2267:1:US). The demand of heating oil will be decreased next week. So, I think it would be bearish in effect.
2. Domestic Economy
Bearish
By observing the Dow Jones industrial average index(http://money.cnn.com/data/markets/dow/), I found that the 5-day change is -0.50%. By check the Dow Jones industrial average index last year this time the data is 5.36%. The …show more content…
Most of the gasoline came from the crude oil. So, the crude oil’s price be increased as well. Due to the relationship between the price of gasoline and crude oil. I think it would be a bullish effect. The price of crude oil will be increased.
7. Changes in Inventory and Storage
Bearish
By reading the crude oil storage report(https://www.investing.com/economic-calendar/eia-crude-oil-inventories-75) on website, the forecast is -2.876M and the actual storage is 2.237M. The difference is 5.113M. The difference last week is 0.697M. They store crude oil more this week. The actual storage is more than forecast by 5.113M. The demand of crude oil will decrease because they already have enough and don’t need more. So, I think it would be a bearish effect due to it was more than they expected. The price of crude oil will fall.
8. Buy / Sell recommendation
By analyzing each of the scenarios above, my results are three bearish, one neutral and three bullish. I think the effect of bullish will overpass the effect of bearish. In one word, I will buy crude oil due to my future expectation about crude oil is bullish. The future price of crude oil will go up. Investors can sell them when the price of oil contracts