Public trading strategy
Oil could hit $150 if Middle East tensions keep choking off supply — position fo
Thesis
The Strait of Hormuz is a critical chokepoint for global oil, and with traffic delayed until the end of the year, a supply squeeze is highly likely. If oil pushes toward the predicted $150 per barrel, energy stocks and oil funds have significant room to run higher. As long as the geopolitical tension remains, this upward pressure on oil prices should continue to boost energy investments.
Strategy approach
Build a long momentum strategy for United States Oil Fund (USO) on a daily timeframe. Enter a long position when the price closes above its 20-day moving average and the Average True Range (ATR) is expanding. Exit the position if the price closes below the 20-day moving average for two consecutive days. Incorporate a 15% trailing stop.