|Chart of the Day|
Sunday, August 30, 2009
Saturday, August 29, 2009
Thursday, August 20, 2009
EIA Gives Crude Oil a Shot in the Arm
The crude oil trade came back with a vengeance yesterday. I have called oil the "trade of the year" but had become bearish in the last three weeks. We had broken the trend of declining inventories, the rally was running out of buyers and the general market looked lower. I surmised that some of the “oil on ships” that was sold on futures last spring was showing up in port and oil prices would correct lower.
The Energy Information Agency (EIA) gave crude oil a shot in the arm yesterday. Inventory dropped 8.4 million barrels. Gasoline inventory dropped 2.1 million barrels. Diesel and other distillates dropped 700,000 barrels. I can’t tell you how surprising these numbers are to me. Get long oil - the trade is on!
Here are our familiar charts. We have almost erased the build in inventory in one week.
We have lost profits by stepping out of the oil trade for the past two weeks. I hate that, but there was no compelling reason to own oil when inventories were building, the dollar was strengthening, and investor confidence in the world economic recovery seemed to be waning.
If you cannot make a good argument to be in a trade, you are better to be out. By my calculations, we have missed a 3% gain on crude oil. I accept that. I was fearful of a 20% pull back. Before you rush into the U.S. Oil Fund (USO), we should be a little suspicious of the big change this week. It wouldn’t surprise me to see a big swing the other way next week.
We all know the self-serving nature of analysts opinions, you never know the master they serve. My opinions, suggestions and observations are without any purpose, except to give you insight to what is occurring in the market. With one bit of information, you may protect your nest egg or profit.
I accept NO money from any company or firm to push a stock or viewpoint. Even if I agreed with them, I would not take their money. You deserve that guarantee. I have seen too many “pitches” only to discover the fine print that the company has been paid to promote the stock.
Disclosure: No positionsEIA Gives Crude Oil a Shot in the Arm -- Seeking Alpha
Tuesday, August 11, 2009
Tuesday, August 04, 2009
Post: Using VWAP to Determine the Structure of the Trading Day
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From Chart of the Day
GOLD : SEASONALLY STRONG FROM AUGUST TO OCTOBER
While the stock market is down significantly from its October 2007 peak,
gold is up
For much of this year, however, gold has been treading water in a relatively
manner. Today's chart, which illustrates the annual cycle in gold, suggests
choppiness is not out of character for gold.
Looking forward, however, gold has tended to put in its strongest gains from
August to early October. - (NB: -and from mid/end November to January)