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| I was particulary struck with the crude oil action yesterday. The pipleline explosion affected the feed to Cushing, a futures delivery point. Normally pretty bullish situation, except the market failed. There has been so much $100 talk this past month & market acts toppy to me. I view the market as too risky for a regular person to trade, but if it does fail at this level it removes a longer term drag on the economy temporarily. However, I have felt for quite some time we may not see a major top in crude until average citizens cease buying SUV's en masse & the price still remains at the mercy of winter weather and heating oil demand. But, slightly lower crude & another interest rate reduction, which I think is already priced into the dollar, may stabilize things for a bit. The question now...will overseas dollars, if the owners of those dollars feel we are at a temporary bottom, race to buy USA assets and products (commodities). That is the question in my mind. In times past, before electronic trading & all the new investment venues, the wave of large buying of USA assets occured once the world was convinced the bottom was in on the dollar. I no longer have good connections in that market as my old contacts are either deceased, working in car washes or sipping adult beverages on the beach in the islands. | |
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Crude Oil Chart
