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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (185619)	3/23/2022 2:45:41 AM
From: sense	2 Recommendations Recommended By dvdw© Pogeu Mahone Read Replies (2) \| Respond to of 217975

Liquid unobtanium... Oil, today... delivered numbers that proved to be exactly what I said they would be... Given oil skyrocketing... "the responsible officials" a week or so back declared that... surprise... there was a much larger (and very conveniently timed) accumulation of oil in the system than had been anticipated... and oil dutifully declined in price... I pointed out "bullshit"... as, there is not more production happening, there is ongoing reduction in supply with fearful customers not accepting delivery of Russian oil (~ 8% of current supply), and there is not (cannot be) "demand destruction" on that scale in that short time given the high level "lack of fungibility" in most use cases. If you have to drive to work... you have to drive to work... and what you have to pay for the gas to get you there has nothing to do with whether or not you will make the trip... And, today, there it was... exactly as I said it would be... In today's ZH article titled: WTI Extends Losses After Cushing Crude Stocks Rose For 2nd Straight Week "After last week's surprise build in Crude stocks (and at Cushing), API reports a sizable crude inventory draw (-4.28mm vs expectations of a small 25k build)." So, "oops"... we lost 4.5 million barrels somewhere... ie., the bogus "addition" last week... was withdrawn. They keep doing this, over and over... and EVERY TIME "a surprise build" turns into "a sizeable draw" a week later... standing there as a huge pair of outliers in an other wise fairly stable flow... Lying like that... seems to work... But, exactly as the MOPE in "transitory" inflation... the "transitory" inventory builds... CAN work... only when it's believable... as when you have a highly liquid market that does function nominally... A liquid market enables that steady flow that REMAINS sufficient to meet demand... and allow a lie or two to be ignored. But, when you try to tell people "we have oil coming out of our ears"... and, they can't buy diesel fuel because there isn't any ? Then, that lie won't work... but, it also means the trucks that were previously scheduled to deliver the food to Los Angeles... won't be making it... ? Maybe those truckers scared Brandon so much... he decided to cut off their fuel ? But, the flagrant lying about oil production numbers... is not a limit... After the discussion of the nickel market... and how it was broken... it seemed likely it would turn out that the "issue" in oil markets was "something like that"... only... ??? No one was talking about it... which was, and is, suspicious... The linked article considers it as: oil prices are declining now... because traders are getting margin calls... and, rather than pony up the cash to stay in the trade... they're just dumping their positions. The nickel market did something like that too... only, the market failed first "due to a short squeeze" but really because of the sudden massive margin calls coming "out of the blue"... So, it was all Fed / banker driven... And then, when trading in nickel resumed, the market failed again with all the sudden dumping at "short squeeze driven price highs"... as, apparently, no one could see that coming any more than they could the margin changes ? The oil trade has been "more orderly"... for now... but, the result is exactly what I said it would be... they've broken the market... There is NOT "more oil" suddenly... and, there is NOT "less demand for oil"... there is only less demand BY INVESTORS... who were large participants in the futures trade... who suddenly are not wanting to hold on to their existing trades in the oil positions they did have in the market. So, as oil becomes increasingly scarce... with a massive looming shortfall coming... the price is declining now ONLY because some number of traders are quitting the trade... or are being forced out of the trade... And, THEN, when the impact of that "price cut" being imposed now has been absorbed... ??? As the looming imposition of scarcity approaches... the market is becoming dramatically less liquid... That will have prices decline, briefly, as the liquidity providers do the mike drop and leave the room... And THEN... what you will get is INSANE volatility... as scarcity suddenly arrives... and oil begins to trade like rhodium. That's likely to occur... (it is being baked in now... only because of the lost liquidity)... even before we experience a largely fixed demand meeting a rapidly declining supply. And, when that event finally happens (from mid April to mid May) it will drive the market FAR out of balance... without the benefit of a liquid market to anticipate, cushion and "smooth out" the impact... It is very likely to be... among the most extreme impacts in a market... that people have ever seen. So, the "price decline" now... is not "oil getting cheaper"... it is oil getting vastly harder to get... as traders hold a "going out of business sale". The price decline now... is only masking the massive impact that's coming with "misdirection"... "Gas Stations Will Run Dry": Catastrophic Scenario For Diesel Emerging According To World's Biggest Energy Traders And, Goldman twists the knife: Used Car Prices Fall As Goldman Points Out Supply Chain Alleviation How unsurprising is it that the morons running things... as the core of their plan to combat inflation... tried to make gas cheaper" by killing the traders ? And, noting, in the chart below... that under Biden, what was a post Covid bounce has turned into a decline of 25%... so far... with the number of contracts traded dropping like a stone, now. Another couple of weeks... and we'll be back to 1970's levels ? And, being curious, I have to wonder... how do you get those "wonderful" GDP numbers and glowing employment reports... with 25% less oil traded ? Finally, amid all the chaos and uncertainty (legal, geopolitical, and economic), it appears traders are stepping back from the market with Open Interest in WTI and Brent futures plunging to its lowest since 2015...