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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (39545)	10/13/2003 2:34:41 AM
From: energyplay	Respond to of 74559

Expanding on the commodity bull market - The world was in a commodity bear market for number of years, caused by 1) Stronger dollar. 2) High oil prices in the early 1980s. 3) Flood of commodites into the market after collapse of communism and industries in former communist countries. 4) Mini flood of strategic commodities released from western stockpiles after fall of communism. This detered new investment, especailly in metal minning, one of the most effective types of commodities. Environmental restrictions will also tighten the supply of metals....

To: TobagoJack who wrote (39545)	10/13/2003 8:43:30 AM
From: que seria	Read Replies (2) \| Respond to of 74559

Jay: Belated answer to your earlier question about NG plays I like. First, given the U.S. NG storage fill and demand destruction, I'm not ready to buy much now. It's too weather-driven a price cycle for me right now (speaking of stock prices, with expectations ready to be priced in either way depending upon weather's call upon storage--I expect near term NG prices to be more stable). Second, the TA picture is at a balance point, with the $XNG on the lip of a breakout or pullback: stockcharts.com[r,a]wbclyiay[pb25!b50!b100!b200!i!f][vc60][iub14!uk14!lc14!la12,26,9!lp14,3,3!lf!ll14][J9820235,Y]&listNum=2 Given the key role of U.S. weather with nearly full storage, I'm not willing to bet much on a break up. This North American NG focus may sound a bit parochial for this thread, since oil is the energy commodity with a world price. Yet as your buying shows, NA NG stocks are nearly as accessible to you as to me. It's my preferred energy sector because I see a long term severe supply shortfall in or near this highest-consumption area, and I lack conviction about oil supply/demand and OPEC/Russia policies. So what stocks? I've owned and will (perhaps as early as today, depending on TA) rebuy the following (US tickers): CHK (excellent mid-continent reserves, lower risk) CRK (strong NG weighting; will jump on bullish NG news) TMR (own some now; very good appreciation potential) MHR (steady gainer; nice risk/reward in mid-continent) EPL (riskier Gulf of Mexico play, given decline rates) XTO (excellent mid-continent reserves, safe LT winner) ECA (Canadian giant, superb reserve base) CHK, CRK and MHR look to be breaking out on the weekly chart while TMR looks dicey. I also own a little GAXI.OB for a speculation; it's run up but may be had on a pullback. The very interesting news about Russia pricing oil in Euros could change the NA energy stock picture even if it turns out to be net neutral (near term) for U.S. in overall economic terms, when coupled with Russia's max-production attitude. If the dollar declines further against the Euro near term (about which I don't have a strong opinion), there will be a currency premium added to OPEC oil, but it should be offset near term by Russian supply pressure. Long term I think the Euro pricing news is big, partly because Russian supply shouldn't make as much difference as the dollar-euro exchange rate, and partly because it is an another step away from a co-dependent relationship with the US dollar (and for nations such as Saudi Arabia, with the US itself). Ironically for the war/oil party, US success in crushing the only local regime with the power and possible inclination to cause regime change in Saudi Arabia likely assisted in gaining Saudi support for this currency changeover. It greatly diminished the Saudis' need for a U.S. umbrella, while increasing the threat to that regime from being allied with the U.S. When our consumers slow down, and our authoritarian "friends" don't need our armed support and don't prefer our fiat, look out below.