Crude shed 3%, Tuesday, on concerns about slowing economic growth. Is it time to take profits in oil?
Karen Finerman explains that if you believe the US economy is going to slow down, then you must also believe there will be a marginal decrease in demand for oil. Subsequently, lower demand will drive the cost of crude lower, she says. The trade, she adds, is shorting the United States Oil Fund (USO).
Guy Adami prefers shorting ExxonMobil (XOM) ahead of earnings. He calls it a gutsy trade that he thinks will pay big.
Dylan Ratigan tells the panel that investors who want to short oil could also buy UltraShort Oil & Gas ProShares (DUG).
Pete Najarian isn’t looking for an immediate move lower in oil. He recommends buying puts farther out.
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Trader disclosure: On Oct 30, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (YHOO), (ATVI), (INTC); Najarian Owns (C); Najarian Owns (BHI) Options, (BIDU) Options, (HAL) Options, (UA) Options, (YHOO) Options, (SNDK) Options, (GOOG) Options; Finerman's Firm Owns (TSO), (WMT), (MSFT), (YHOO); Finerman's Firm And Finerman Own (C), (GS), (HD), (TGT); Finerman's Firm Is Short (MER) And Owns (MER) Puts; Finerman's Firm Owns Russell 2000 Puts; Finerman's Firm Owns S&P 500 Puts