Prediction
Gasoline RBOB is poised to decline over the next 2-4 weeks as the Crowd sits near its longest positioning in 5 years, indicating crowded longs that are likely to unwind, while Smart Money is near its shortest positioning, further supporting the downward pressure
Key points
- Smart Money — 18th percentile, Crowd — 93rd percentile
- Smart Money moved -1.0 percentage points this week, -2.6 percentage points this month
- Open Interest +4.8% month-over-month
Why it matters
Smart Money is currently at the 18th percentile of its 5-year history, indicating it is near its shortest positioning, while the Crowd is at the 93rd percentile, near its longest. This setup suggests that the crowded longs in the Crowd will unwind, leading to a price decline as the market corrects.
What confirms the thesis
Smart money stays near its short extreme and Gasoline RBOB fails to reclaim recent resistance.
What invalidates the thesis
Smart money covers its shorts quickly or Gasoline RBOB pushes through recent resistance.
For informational purposes only. Not investment advice. Disclaimer.