Quote:
Originally Posted by Zarley
It's near impossible to predict these things, especially when the market is not entirely rational - prices continued to increase despite a clearly building supply glut.
At least we are seeing US production continue to decrease from a peak in July 2015 and with rig count down from a peak in Oct '14. So that's a positive trend.
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I believe that the market was being irrational previously because it was so focused on the short term inventory glut, and now is acting more rationally and realizing we could be in an undersupplied market as early as this year.
There is a clear change in market behaviour here, and I believe it's based on fundamentals, though the consensus is short squeeze or whatever. I've been pounding the drum on this pretty hard. Still not locking in gains from the 20s, I personally think we could be back at $50 pretty easily by year end.
But, I know nothing. Nobody knows. Only thing is that when you get these extreme levels of sentiment, either high or low, they tend to overshoot.