The Energy Report
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New lows for the year!
Tue, Nov 18 2008, 17:58 GMT
by Phil Flynn
Oil bears put on the full court press as the December option expiration failed to give the market pause. Is oil headed to oblivion or are there any signs that this market can find a bottom.
Oil is being overwhelmed with the weight of the global economy and is finding it hard to stand on its own. It is not what the market is focusing on that will give you a sense of the market’s mood but more so what the market is ignoring. Take for example piracy on the high seas and pipeline explosions and violence in Nigeria. These stories that before July would have sent the energy complex soaring are now just a distant noise in this market's bearish obsession.
Still as bad as things look we have to acknowledge that the market will at some point find a bottom. Or if not a bottom a trading range that will keep the market moving. Winter is here and we are getting off to a rather cold start. Oil could try to find a bottom near $50.00. Still if $45.00 does not hold it is possible that the next target is $35 a barrel. The difference between t$35.00 and $45.00 is the depth of damage to the world economy. The monthly charts for oil seem to suggest that the downside in oil and the stocks have about run their course, still the worry is that neither have any solid signs of bottoming action. The next few trading sessions may be critical in determining the next big move for oil. The rest of the year it may try to test $50 and hold there. If $50 can hold through the rest of this year then we should see a solid bottom to work off of. If not, we start playing for $43.00. Right now we still sell rallies but perhaps start looking at some calls strategies going out longer term. Position trend followers stay short to the bitter end and day traders should see some great opportunities.
Our short December crude from apprx 7439 was sold on Friday on a double rollover at apprx 5704!!! We sold January apprx 5760!!! Stop should be 6100!!!
We're long December heating oil from apprx 18000 - stop 17600.
Sell December RBOB at 13600 - stop 14400.
Buy December natural gas at 515 - stop 500.
Have a GREAT day!
Published on Tue, Nov 18 2008, 17:59 GMT
Archive
- Life Liberty and Oil!
Published On Fri, Jul 3 2009, 05:53 GMT - Oil's got to accentuate the positive
Published On Wed, Jul 1 2009, 05:57 GMT - China is providing the fireworks!
Published On Tue, Jun 30 2009, 05:49 GMT - Post Fed Commodity Rush
Published On Mon, Jun 29 2009, 05:40 GMT - Oil Intervention
Published On Fri, Jun 26 2009, 06:26 GMT
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