Investing.com - Financial Markets Worldwide
😎 Watchlist Weekend: Copy legendary investors' portfolios to your watchlist in 1 clickCopy for FREE

Crude Oil's Fear Index Spikes: Bullish Reversal Forming At Support

ByChris Kimble
Published 03/10/2020, 01:51 PM
CL
0.00%
OVX
-4.53%

CBOE Crude Oil Volatility Index, Crude Oil (bottom)

The coronavirus has caused severe economic uncertainty, as economists are beginning to weigh its effect on economic growth.

This has brought heightened levels of fear into the financial markets, sending both stocks and economically sensitive commodities like crude oil cascading lower.

On Tuesday crude futures crashed lower alongside the stock market. We warned about the potential for crude oil and stocks to top at the same time (back in January). And oil prices are now nearing levels not seen since 2016.

The crash in prices has sent crude’s fear index (OVX) spiking higher to all-time highs (2). The prior two spikes occurred near major crude oil price bottoms at (1).

And the latest spike comes as crude oil tests its prior price lows from 2016 at (3). Could this turn into a double bottom? Oil bulls (and stock bulls) sure hope so.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads.

Which stock should you buy in your very next trade?

AI computing powers are changing the stock market. Investing.com's ProPicks AI includes 6 winning stock portfolios chosen by our advanced AI. In 2024 alone, ProPicks AI identified 2 stocks that surged over 150%, 4 additional stocks that leaped over 30%, and 3 more that climbed over 25%. Which stock will be the next to soar?

Unlock ProPicks AI
Read Next

Latest comments

Bob WilliamsonMar 13, 2020, 03:40
The highest fear levels always precede bottoms. Duh! I think we could still go lower. Stocks, even at a 26% discount, are still not cheap. Baby stocks in the Russell are off 35%. That's where I'd look for bargains. I would only nibble at oil above $20.
Bob WilliamsonMar 13, 2020, 03:42
BTW Thanks for writing this article. I don't agree with you but I can always change my mind if you turn out to be right. I wish others would write about oil publicly. It's a closed system most of the time.
ugur timsahMar 11, 2020, 13:53
You are so wrong i think
Show all comments
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2025 - Fusion Media Limited. All Rights Reserved.