****USO:comment: i have chosen to monitor USO for reversal in crude.
Reason : The investment seeks to reflect the performance, less expenses, of the spot price of West Texas Intermediate (WTI) light, sweet crude oil. The fund will invest in futures contracts for WTI light, sweet crude oil, other types of crude oil, heating oil, gasoline, natural gas and other petroleum based-fuels that are traded on exchanges. It may also invest in other oil interests such as cash-settled options on oil futures contracts, forward contracts for oil, and OTC transactions that are based on the price of oil. The fund is nondiversified
link to USO chart showing MFI and other critical elements, and one will see how MASSIVE this selloff--massive! look and see.
stockcharts.com
It has crashed from its high of 77 to a now 44.50 at close today.
We are having likely a good deal of longs being forced to sell.
Breakdown here is setting up a major buying opt, but let's hold back as we now have down momentum that could be fed by some hedge fund betting long being in trouble.
Analyst was aksked "why no geopolitical concerns regards crude' responded "They are now arbitarily being ignored but these concerns have NOT been forgotten"
Biggest factor now is this prolonged extraorinary mild winter weather and fact 2006 was the WARMEST year in the recorded history of weather in the United States as set off a avalanch that are catching longs and setting off forced or panic selling.
Also we get the reverse side where we now have bear attitude in Crude getting ebullient.
Summation, this is the major time of sell-off of what will remain a Bull Market in energy.
Watch CLOSELY as this i am betting will be a "golden" buying opportunity.
Marc Faber sees potential to for crode to hit 45 area , even 40, BUT that Crude will go back into the 60s EVEN with NO geopolical crisis in M.E..
But adds IF something goes wrong, such Iran, crude will run totally WILD, sky's the limit--125 or higher.
So regardless of Iran, Crude is , or is moving to a screaming buy.
If Iran happens, it will ---like forgetaaboutit. |
