Category Archives: Commodities

Crude Oil’s Key Levels

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I guess the whole Greek nonsense has been put on hold (again) until Saturday, just so the angst, tension, and uncertainty can persist. The situation has long passed the point of tragicomedy.

So let us turn our attention instead to crude oil, which ended its firm, steady push lower early this year. Since then, it has been sputtering into a tighter and tighter range. I am, naturally, wanting it to break lower, but there are two levels needed for that: first, the front month needs to slice below the $59.19 level, tinted below in yellow. If it can manage that, the failure of the symmetric triangle (approximately where that red circle is) would be just what the doctor ordered for the downfall to resume.

0625-cl

Big Moves are Coming

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I follow four areas of the market very closely; volatility, miners, gold, and the SPY index, and everything smells of deflation.  I trade on the 2 and 4 hour, but I took a step back and looked at the monthly, weekly, and daily charts and everywhere I look it smells of lack of oxygen.

The broad market has a decreasing positive slope (8% y-t-d), and why not, you cannot continue to have 10-14% (from 2014) annualized growth rates with no GDP, Income, or fixed income rates.  The charade started with a relative yield trade, then a squeeze volatility trade, and now we are wrapping up the leverage the balance sheet trade.  The Central Banks and politicians have done everything except the right thing, and maybe because the  right thing is the hard thing.

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Duck, Duck, Goose

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Wednesdays before expiration (especially on FOMC days) are special days.

Volume is split between 2 contracts.  We have stops getting killed on both sides of indecision, and then a lot of chop, chop, slam….  chop, chop, slam….  It reminds me of the old Duck, Duck, Goose game.  Only this time, retail stops are left holding the bag and can’t find a chair or get a break.

The witching hour appears to be the hour going into oil pit close.

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Crude Market Forecasts

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The news scams and crude market forecasts are becoming even more crude.
You can read last week’s Bloomberg article quoting the helpful folks at GS here:
Bloomberg: Goldman Says $40 Oil Call May Be Too Low as Demand Surprises

Then, you can enjoy this chart showing what appears to be a nice Distribution Zone, followed by a 10+ sigma, 7-handle move to down.  Please enjoy the custom selected colors:

Crude Reality

Long live 50s!   Errrr…. 40s!

If you really wanna have a blast, join the fun at #RigCountGuesses.

Still Crude: EIA, EIA, oh

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Old MacDonald had an oil farm, E-I-A, E-I-A, Oh!
With a stop run here and a stop run there,
here a stop, there a stop, everywhere a retail stop, E-I-A, E-I-A, Oh!

Wednesdays are Prince Spaghetti Day.  They are also when the US Energy Information Administration releases its weekly petroleum status and crude oil inventories (except during holiday weeks).  Check out the last 3 EIA news scam days.

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