Bullish Case: Increasing volatility in CVE implied forecasts indicates potential upward price movements as oil prices stabilize. Optimistic demand forecasts may lead to a bullish reversal as investor sentiment improves.

Bearish Case: Stagnant historical returns and low trading volumes suggest an ongoing bearish outlook. Any geopolitical tensions or economic downturns could amplify concerns, suppressing CVE's price further.

Potential Outcomes:

1. 40% chance of stable oil prices boosting covers;

2. 30% likelihood of ongoing underperformance relative to peers;

3. 30% risk of external events catalyzing price declines.

Trading Oracle: Execute a short call spread: sell CVE 01/17/2025 20.00 C and buy CVE 01/17/2025 25.00 C to capitalize on elevated implied volatility without significant price movement. Alternatively, consider bullish long put spreads if bearish sentiment prevails. Focus on a 70% probability-of-profit with robust risk management.

November 12, 2024