This Exchange Traded Fund (ETF) seeks to reflect the performance of West Texas light sweet crude oil on a daily basis management minus fees. And you can imagine with the recent drop in gas prices and the recent drop in oil prices, this ETF has been under some tremendous pressure.

52 Week Low

In fact the ETF reached a new 52 week low today, trading down 7% roughly to $50.15, with the price closer to an even $50 in after-hours trading. I was looking for a break-out below resistance at $50.85 reached on October 27^th. Today broke below this low point, signaling further deterioration in the fund.

Rally Signal was Close

The ETF almost made a bottom formation earlier in the week when it reached $57.38 on November 4^th. But the breakout to the upside was short lived as the economy continues to look week causing oil prices to fall on fear of a global recession. The overall market performed almost as poorly today, with the Dow Jones Industrial average falling 4.85%. Week employment numbers where the main catalyst with a very high number of Americans claiming long-term unemployment benefits.

The Trade

You can get short the ETF on a rally day which could happen early on Friday. With such a large drop in one day as we saw today, there could be some buying early tomorrow which would provide a chance to get in gradually with other rallies over the coming weeks.

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United States Oil

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