Mad Day Trader Jim Parker Kills it With an Oil Short
Mad Day Trader Jim Parker is a modest guy. He has never been one to boast of his many achievements. If he does a great trade, he simply marks it in the ?WIN? column and moves on to the next trade.
I, however, am not Jim Parker.
As you may have noticed over the years, I have no hesitation whatsoever about singing my own praises, as well as those of others. So, I will bang his drum for him.
A week ago, Jim piled his followers into the (USO) March $17.5 puts at 35 cents. These are the short dated options which expire this coming Friday, March 20.
With a 15%, $7 crash in the price of oil that followed immediately afterwards, where are these options trading now? How about $1.50, a meteoric increase of 429%!
It gets better. The oil market is in the midst of a capitulation selloff, which could reach a crescendo with the Friday options and futures expiration. There is a distinct possibility that oil could visit the $30 handle then.
Where would that value the (USO) March $17.5 puts? How about $5.00. That would deliver a ten-day, eye popping profit of 1,429%!
While other newsletters promise these blistering results in their marketing blurbs, the Mad Hedge Fund Trader is one of the very few that actually delivers the goods.
This is nothing new for the Mad Hedge Fund Trader. It is only the latest in a series of prescient forecasts that we have been making about the energy markets for years.
Maybe the five years I spent in east Texas getting oil under my fingernails in the Barnet Shale have something to do with it.
To show you how far ahead of the curve I have been, I have included two archival pieces below.
The first was published in February, 2012 and lays out the logic behind my expectation that progress on nuclear talks with Iran would kill the risk premium the price of oil has enjoyed for years, taking it to as low as $30 a barrel, and lead to a Pax Americana.
That is exactly what is happening now, but my readers learned of the prospect three years in advance.
I ran the second piece in January 27 this year warning readers not to chase the oil rally because an impending storage Armageddon guaranteed that the worst was yet to come, the bottom for Texas tea. We hit new lows today.
Not only did I call the first oil crash, I nailed the second one as well.
I subscribe to a couple of very expensive oil industry newsletters that are great with passing on raw data about endless esoteric minutia, like rig counts, futures spreads and global demand at the micro level.
Not one saw the big picture, that the commodity that they live and breathe for was about to halve in price.
Enjoy the pieces. They are still relevant.
