Well, OPEC day is here, and it looks like a deal announcement is at hand. Crude oil is rallying (and energy stocks are strong), so R.I.P. to my energy shorts. I will note, with mild interest, that in spite of this huge news coming out of Vienna, so far crude hasn’t even exceeded the horizontal I drew weeks ago. We’ll see if the actual announcement renders this line moot.
As many energy shorts as I’ve got going (AMP, APC, DVN, EGN, and so forth) I’m keeping everything I’ve got two of crossed for good luck, since the big OPEC announcement is tomorrow morning. The past several days of trading don’t exactly express gobs of confidence in all these fine gentlemen voluntarily sacrificing oil revenue for the greater good of the cartel. I suspect there will be some new ridiculous rumor any moment now, in a desperate bid to keep this charade going just one more day.
Happy new week, everyone. I’m relieved we’re past Thanksgiving and can get back to normalcy. I wanted to make a couple of remarks about two big commodities out there – gold and oil.
As for gold, it’s been having a wretched time since July 6th, from which it’s fallen about 15%. It is finally getting a little bit of strength, but I think it’ll be short-lived. The most logical place for it to crawl back would be the gap I’ve pointed out below, just about $1200. After such time, I think the weakness will continue afoot. I have no precious metals positions at all right now, but if gold strength continues, I’ll be looking hard at GDXJ again for a short sale.
The big OPEC meeting is next Wednesday in Vienna, and from what I’ve read, crude is going to move massively either up or down, depending on the outcome. That sounds like a ridiculous thing to write, I realize, but the point is that this is a BIG “binary event” in the world of energy.
Last year, exactly at this time, the world of crude oil started falling to pieces, and it fell steadily for ten weeks. None of us can know what next week holds, of course, but at the moment, faith in a deal by which the cartel abides doesn’t exactly seem strong. I’m sticking with my many energy shorts.