USO Forecast



Bearish<—>Bullish



80% Confidence




Bullish Case: The backwardation in USO's IV curve suggests near-term supply concerns. Coupled with bullish risk sentiment and a 37% higher call volume, USO may rally.




Bearish Case: Elevated IV in short-term options highlights potential downside risks amid historical volatility patterns and sentiment skepticism.




Potential Outcomes:

1. Continued upward trend (30%).

2. Moderate decline due to volatility spikes (50%).

3. Neutral drift (20%).




Trading Oracle: Trade a bullish call debit spread: Buy USO Feb 78 Call, sell USO Feb 82 Call. Short-term outlook leverages backwardation and potential upside. High reward-to-risk due to rising bullish sentiment and low current option volume, enhancing the profit edge opportunity.



January 11, 2025


United States Commodity Funds Forecast

USO        United States Commodity Funds











Correlated Assets

Assets that tend to move strongly with USO



BNO Forecast + Options Trading Strategies   BNO  United States Commodity Funds LLC - United States Brent Crude Oil (0.99)


FANG Forecast + Options Trading Strategies   FANG  Diamondback Energy (0.7)


XOP Forecast + Options Trading Strategies   XOP  SPDR Oil & Gas Exploration and Production (0.68)


GTE Forecast + Options Trading Strategies   GTE  Gran Tierra Energy (0.67)


OXY Forecast + Options Trading Strategies   OXY  Occidental Petroleum (0.6)



Uncorrelated Assets

Assets with little price relationship to USO



PLBY Forecast + Options Trading Strategies   PLBY  PLBY (-0.0)


CG Forecast + Options Trading Strategies   CG  Carlyle (0.0)


WHR Forecast + Options Trading Strategies   WHR  Whirlpool (0.0)


UBS Forecast + Options Trading Strategies   UBS  UBS (0.0)


PATH Forecast + Options Trading Strategies   PATH  UiPath (0.01)



Anticorrelated Assets

Assets that tend to move strongly against USO



VSCO Forecast + Options Trading Strategies   VSCO  Victoria's Secret (-0.51)


FXY Forecast + Options Trading Strategies   FXY  Invesco CurrencyShares Japanese Yen (-0.51)


S Forecast + Options Trading Strategies   S  Sprint (-0.56)


RDFN Forecast + Options Trading Strategies   RDFN  Redfin (-0.61)


MCD Forecast + Options Trading Strategies   MCD  McDonald's (-0.61)









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