I hope you’re having a wonderful weekend, my Slope family. The Rev was a little under the weather this week, so my usual radio voice will have to be replaced by some illuminating keystrokes.
Before the year ends, I wanted to take a brief look back at the last six month, but more importantly, at the year ahead that awaits us. In my last market update, from June 23rd of this year, we discussed the continuing bull market in SPX and how it was following nicely the 10 year crude oil analog. We forecasted continued strength in SPX, as a period of sideways consolidation was likely to breakout to new highs before year end. SPX closed on 6/23 at 2438, and currently trades at 2675. Voila! The crude oil analog in practice. (more…)
One of the few interesting patterns I see cooking right now is crude oil which, on an intraday basis, has an extremely well-formed top.
Oil has been completely bananas today. Aside from this insanity, energy stocks still have some interesting topping patterns. They’ve had tremendous strength for weeks, but I think they’re ready to flip lower. Here are a couple………
Further to my prediction at the end of July that WTI Crude Oil may reach $65.00 if it could reach and hold above the 55.00 level, this update will confirm that such a scenario is still a possibility, even though it’s now three months later and we’ve seen a rise in volatility, as price has bounced around in a $10.00 range since then. As I write this post Sunday evening, it’s finally hovering above 55.00.
As can be noted on the Monthly chart below, I’d say that a retest of the bearish (monthly) Moving Average Death Cross around 65.00 is imminent and that momentum currently favours the bulls — particularly in light of the Saudi purge that is underway, as well as recent military activity that’s occurring in that region — and as illustrated by the recent bullish (daily) Moving Average Golden Cross that has formed on the Daily timeframe (see second chart below). (more…)
I was already short Oil States (OIS), but I added to it, because any energy-related stock that can manage to be down hard on a day when oil is roaring higher is a friend of mine.
To anyone friendly to natural gas for the past five months, holding a long position certainly has been a challenge, and has been more akin to riding a bull on the PBR circuit.
Just to illustrate the bumpy ride, take a look at the 4-hour chart of the nat gas futures (NG) showing the price swings across a multi-month range carved out between 2.90 and 2.82 on the low side of the range, juxtaposed against resistance atop the range at 3.15 to 3.23. Within that range, over several months, there has been no significant change in the perceived fundamentals that indicate there is just too much natural gas around to lift prices consistently above 3.15 for any length of time, yet there is also an apparent perception that under 2.90, nat gas prices are relatively cheap.