After a week of heavy selling, oil finally caught a bid on Tuesday. Is this just a dead cat bounce, though?
Independent oil trader Dan Dicker certainly thinks so. There is no reason to be long oil right now, he said on the "Fast Money Halftime Report."
Dicker became bearish on oil two weeks ago, when the price of oil started to flatline, or lose the steepness of the curve. This trend proves that the market cannot ignore China's purchasing managers index, an indicator of the economic health of its manufacturing sector, he argued. After all, any decline in its PMI suggests a decline in demand, thereby driving down the price of oil.
"What you want to see when oil comes down like this is a steepening of the curve, a little of contango to come back," Dicker said. "So far, even though oil has dropped an enormous amount over the last three to four days, I haven't seen that steepening and until I see something like that happening in some of these spreads, I'm not feeling very constructive on oil right now."
There is, however, value to be had in two places, he noted.
A few oil exploration and production companies' stocks "just got murdered" lately, Dicker said. Anadarko , Apache and Chesapeake Energy , for example, are a few names to consider.
Dicker also suggests checking out mega cap E&P companies Total and Chevron because they pay you to wait.