SPY Session Sneak Peek: Tensions in the Middle East Spike Concern Over Oil Prices

SPY Session Sneak Peek: Tensions in the Middle East Spike Concern Over Oil Prices
August 25, 2014 Market Traders Institute

Yesterday’s Monday Morning Spy Session was filled with tons of valuable information regarding geo-political issues and how they could affect options traders. Here’s a sneak peak of what you missed.

It’s an eventful week for options traders, as the economic market decides how to react to geo-political topics like the Jackson Hole Symposium and recent unrest between Russia and the Ukraine. But, tensions in the Middle East take the SPY spotlight, as concerns over oil prices and the global economy continue to grow. The pain at the pump gradually increases in conjunction with yesterday’s brutal battle between Islamist militias in Libya and the 94th U.S. air strike on Islamic State, Mosul.

So far these tensions have caused European markets to slip and there is no telling the extent of possible supply disruptions. From a trader’s standpoint, crude oil tends to be a trending market. There is usually a major bias to the upside or downside, so in order to capitalize one would – [Section Removed – Proprietary Information for MTI Ultimate Options Course Students Only.]


The price of gas in California is hovering near the $4 mark, and many experts are wondering if this will influence America’s clean energy agenda, causing some options traders to divert their attention from the oil market. In an interview with ClimateCentral.org, Guy Carusio, a 40-year veteran analyst of global energy markets, states:

“A disruption anywhere affects us. That’s why it’s important that we think of this globally. If there was an expansion of the disruption, it would lead to even higher prices and put some pressure on our economy. Even if we got zero oil from the Middle East, we still pay the world price.”

 

While most of the U.S.’s oil comes from Mexico and Canada, the Middle East still provides more than 10 percent of of the worlds’ 84 million barrels of oil, which means regardless of where it comes from, the oil market is drastically affected and thus gas inflation could increase.

To get a sneak peek of this week’s expert trading plans, market report details, and get your plan ready, RSVP for an upcoming FREE Options workshop here.

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