Oil is looking Winded to me....time for a breather -- whether its Y2K or not

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Some of you old timers here on the forum know that from time to time I'd get a little bold and make gold market or stock market or oil market price predictions. As is usual whenever I've made public pronouncements that put me out on a limb against a trend, that limb usually get's sawed off on me. Now, while I'm known as enjoying a thrill, I'm not particularly a thrill seeker. Some do say that I'm a glutton for punishment. That must explain my need to go out on another limb in another tree.

As we've all been following oil, my technically oriented broker-trader tools have been used to track the upswing in oil. So far, so good. I think I'm batting about 70-80% of late on oil tho' not everything got posted here. Anyway, I'm goin out on that limb and I'm thinkin now, on gut hunches, not on the technicals...just a gut hunch that on Thursday we're gonna get a down day on oil. WHY?

1. Cause absent fresh crisis news of supply or demand, there's some folks out there on the market with some hefty profits who are most likely ready to take profits at the least little sign of a pullback so they can cashin and then await to see whether or not to buy the dip back or "short" the market back down out of the breakout. Such moves would not affect the overall bullish technical buying signals. In fact, for the bull to really continue, you've got to have the market (any market) stop and regroup, and catch its breath.

2. I think this market is winded. Yup. This market has been racing for well over a week. Need to stop and get some air if they can. In other words, we need fresh money into the market. Right now, all the ready money seems to have piled into the market that really wants to. On that basis, she's a little tire. Needs a breather.

3. Frankly, I expect the Feds are gonna pullout some PR gyrations on Thursday in an attempt to talk the market down a bit.

NOW IF THIS IS NOT TRUE ABOVE...and IF we get another strong up day it will most likely be because of some sort of crisis news regarding supply issues. Also the market has overnite to digest the inventory reports and while it was pretty neutral there was some slight increase in certain inventories, like crude, (heating oil was down, understandably).

IF we get word publicly of say, problems in Saudi Arabia, like what Ed Yourdon had in that email from a Saudi remediation source about certain oil facilities being "toast" over there... If that pans out to be true and carried in public newswire services...that would explode the oil market. Who knows how much upside it would fire instantly, maybe a buck or two a barrel within minutes if not seconds. Frankly, I don't expect it, but just mention it to cover the bases.

I really half way expected profit taking to set in Wed when it started off week, ahead of the inventory report due out at market closing on Wed. Instead, the market firmed and Feb got near $30.00!

So anyway... I'm out here on a "short" limb looking for a small pull back of 50 cents to a buck, maybe over the next day or two. So now that you've stopped by, wave and say howdy and chuckle at my plight of being out here on that limb.

Hey it's kinda cold out here, anyone got a spare cup o coffee? Hot Chocalate? No flame-throwers tho'.

-- Dick Moody (dickmoody@yahoo.com), January 20, 2000

Answers

Dick, If you were in frlchat (in MSN) I'd offer you a (B) [err a beer]

Chuck

-- Chuck, a night driver (rienzoo@en.com), January 20, 2000.


Dick, nobody knows what will happen next, but we sure do appreciate your educated guesses. Thanks.

-- King of Spain (madrid@aol.cum), January 20, 2000.

Hi Dick,

It's up again so far 69 centsto $29.54

Crude Oil(NYM) Feb 28.55 29.68 28.55 29.54s +0.69 1/20/00 5:05

Out to buy some July calls today, so a dip would have been good. Don't wanna miss this train... :o)

-- Andy (2000EOD@prodigy.net), January 20, 2000.


Dick

Good points. However, if this is a market that cannot make delivery, all bets are off. In a short term sense, indeed the market is overbought. The NYMEX increased traders margin requirements last night. This is a signal from the exchange (and most likely the gov't) that these prices are beginning to hurt. Do doubt they will try everything and anything to save their bubble.com.

I doubt u will hear anything regarding bad news from the official media. Who knows? This whole market and society is in denial. The bubble dreamers not want to burst their fantasies. The markets are totally political now (ever since 1987 in fact) and the politicians will do anything to save their skin.

Looks like heating oil is bucking the trend and is up on the day.

Should be very entertaining, to say the least!

Best regards

-- Ishkabibble (ishman@home.com), January 20, 2000.


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