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Strategies & Market Trends : Playing the QQQQ with Terry and friends.
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To: IHateSourCream who wrote (646)6/6/2005 1:46:39 AM
From: Walkingshadow  Read Replies (3) of 4814
 
Note also (FWIW) that light sweet crude futures are trading very strongly. As I write this, they are currently at $55.42. Note that the downtrend line in the stochastics has been broken to the upside, which tells me there is a change in trend taking place here. Although oil is overbought now, and will eventually pull back, I think there will be upward pressure on prices for the next several weeks:

futuresource.com

Note that overbought status is often maintained for quite a while with oil, which reflects the fairly strong uptrend.

While I don't put a lot of faith into oil as a determinant of stock prices at this time, still this provides an almost irresistable "explanation" for the market movement that is strongly suggested by the charts, technicals, market internals, and volume patterns as detailed in my previous posts today.

So the talking heads can crow that stock prices are going down "because" investors are nervous about the price of oil, raising the possibility of significant inflation and a shift in FOMC policy to a more aggressive stance. Never mind that the FOMC just got finished saying they are not worried about inflation and have no plans to change their plans. And the FOMC has never been known to change policy based on a mere week or two worth of speculative trading in a single commodity future, and I hardly think they'll begin doing so now.

Still.... don't be surprised if you hear such blather from the talking heads next week.

T
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