Money managers have started to close out short positions on oil. The oil price slump that started mid-June could be about to reverse. The disconnect between the physical crude market and paper crude market remains large. Short sellers are closing out short positions against oil-focused exchange traded funds, while money managers have modestly increased their holdings of crude oil futures over the latest reporting week. These trades suggest that speculators, traders, and hedge fund managers may have started to believe that the 20% crash in oil prices since the middle of June could be over, and prices are set to go higher from here. The largest U.S. oil stock-focused ETF, Energy Select Sector SPDR Fund ( NYSEARCA: XLE ), has seen traders reduce short interest by 14% in the past month, data from market analytics company S3 Partners cited by Bloomberg shows . XLE’s top stock holdings include the […]