Over the past several weeks, NYMEX open interest contracts on WTI crude oil have been climbing higher and higher, going from 277,212 on August 21 to 305,623 on September 11. Looking at the chart below, you could argue that technicians and pattern readers would have some slick nickname for this pattern along the lines of “triple peak.” As far as we’re concerned, it looks peak-ish to us, especially with the amount of hedge funds piled in that are long WTI crude.
Energy Analyst Kevin Kaiser thinks we could be topping out here, noting that “oil sentiment (as measured by hedge fund net length in NYMEX) is climbing back up to the level where it’s been a good spot to sell from.” Keep an eye on it.
