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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: nspolar who wrote (9437)	5/19/2008 9:12:53 AM
From: robert b furman	Read Replies (1) \| Respond to of 33421

Hi Falcon, Thanks for the post - one of the best reads I've read in a long time. Interesting that CME is now bidding to buy Nymex. I wonder if that pulls in ICE?? G&S and their bullish oil estimates also explains how their profitability survived the credit crisis. Neuter the crisis and make it on oil - you beat all the competitors. I love the quote: “What you have on the financial side is a bunch of money being thrown at the energy futures market. It’s just pulling in more and more cash. That’s the side of the market where we have runaway demand, not on the physical side.” End that with countries no longer buying for their SPR and you've finally got a crash every one will enjoy - can you spell a turn in consumer confidence and a stock market rally like the globe has never seen. Great read ! Thanks again. Bob Bob

To: nspolar who wrote (9437)	5/21/2008 12:47:47 AM
From: John Pitera	Read Replies (4) \| Respond to of 33421

I believe that WTIC is putting in it's top for 2008. The Falcon and I have been discussing price pivot turning points of 130 (TF) and 132 (JP's crystal ball gazing number). There are several different Elliott Wave time and price clusters that are in this area in price and we are starting to enter the turning point "window"; as well as some WD Gann and various additional technical evidence that is lining up for this presumed price high @ 130-132.63 (I've got to give a $2 leeway for a move to 134 and change in a spike move reversal.) The single most compelling data point that I can point to is that the entire Crude futures curve (or strip) has achieved something very very rarely witnessed at elevated market tops. the entire forward strip is priced above the nearby spot price of the high open interest nearby month. the Strip (or curve) is showing a price of 131.04 for Dec of 2011 and the long dated contract is way up at 138.38. As Patrick Slevin would comment this is an entire forward strip (curve) that is in contango) and is simply illogical and extreme with spot crude at 129 and change. This is one of the type market extreme sentiment shifts that occur at significant intermediate and longer term tops. This is a death knell for significant price appreciation from this point. The commercials can come in and sell their product in the forward markets at grand slam prices. the only way you can get on board this continuing to occur would be to see a currency collapse and a hyper inflationary environment. That is not going to happen now. ( i'd give it a 2.4% outlier possibility). So the energy complex is totally juiced up in price we have the commercials who can come in and lean on this market from here to doomsday at this price level and they will have their way. They are the commercials. This is an aberation. The commercials can sell endlessly into this market and they can deliver the actual product so they are not going to get caught short. (that's my analysis; and I realize it's an opinion and analysis that is going against the popular grain..... if it was not who the heck else could be long all these bloody crude contracts with a 130 dollar handle. If I am wrong and we zoom to 150- 160 you can feed me humble pie. But otherwise a few of you hedge funds and wealth management offices; ....commercial entities etc. should retain the services of someone who has been involved with the markets for more than the past single cycle. So let's see how this plays out. Hell I traded my first crude contract in 1986 and it almost had a single digit handle! John