The Oil Bull Resumes
August 21st 2008 17:54
The Stock Market Punk yesterday wrote about Gold and Oil markets, suggesting that many were bullish on Gold as it hit $1032 and Oil traded over $147, but now that Gold fell below $800 and oil off $35 from its high, where are the gullible now? He writes,
I wrote, in his comment section,
Today, Oil is up over $5 to $121 and Gold is up over $21 to $834. In a trending market, expect violent reactions in the opposite direction to the trend. The market's job, as Punk says, is "to separate the money from a fool..." If you are long the market tries to get you fearful, to sell early, to take losses, fearful of getting back in just before another correction. If you are short, the short covering rallies are fearsome and will scare you to cover at the wrong time.
I don't know why it is, but you go to Nordstroms the day they put things on sale, and you make a decision to buy. Do the same thing with Oil or Gold and you hesitate, think it will go lower, think the move is over. Talk about gullible!
So what does my oil chart look like today? First of all, the trendline off the high was broken, next the low of $111.50 was tested and held. Then today the intermediate high of $117.40 was broken. Fibornacci retracement would suggest resistance up around $130 to $133. Will the Bearish trend in oil resume? Not unless $111.50 is broken to the downside
Naturally, we cannot deny the fact that the price of oil has gone up rather tremendously (despite the big pull back) but was it really because the world’s machineries are immediately consuming every single drop of oil produced by the exporting countries, or was it because greed has found another instrument in oil to take advantage of the market’s gullibility?
Careful with your prognostications, Punk, my studies show that Oil is still trading above its long term trendline. Major support is at $100 to 105.
As for Gold, its trendline is in no danger of being broken. In fact the last major pullback was 22% and that's about where we are at this time. Painful, but no big deal.
As for Gold, its trendline is in no danger of being broken. In fact the last major pullback was 22% and that's about where we are at this time. Painful, but no big deal.
Today, Oil is up over $5 to $121 and Gold is up over $21 to $834. In a trending market, expect violent reactions in the opposite direction to the trend. The market's job, as Punk says, is "to separate the money from a fool..." If you are long the market tries to get you fearful, to sell early, to take losses, fearful of getting back in just before another correction. If you are short, the short covering rallies are fearsome and will scare you to cover at the wrong time.
I don't know why it is, but you go to Nordstroms the day they put things on sale, and you make a decision to buy. Do the same thing with Oil or Gold and you hesitate, think it will go lower, think the move is over. Talk about gullible!
So what does my oil chart look like today? First of all, the trendline off the high was broken, next the low of $111.50 was tested and held. Then today the intermediate high of $117.40 was broken. Fibornacci retracement would suggest resistance up around $130 to $133. Will the Bearish trend in oil resume? Not unless $111.50 is broken to the downside
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Comment by Market Newbie
Stock Market Punk
Or is he confessing to be the guy at the other side of the newbie’s fence? Does this man need the newbie’s vote so he can succeed - at least as a writer? (Well, this is the last time I am going to unwillingly give it to him.)
At best, what this man is doing is open the textbooks for the newbie, as if he is the only one who has access to them.
What’s up yours old, man?
Is there something that you need to prove to anyone? Like, maybe, that you can piss farther that anyone else? Well, let’s say that you can. So, who cares?
Is this man saying that if the bubble makers are able to sway me to buy oil at $147 (or anywhere near it) and it is now at $121 that I would have made money in the process?
When the market newbie writes his thoughts, his motive is to warn other newbies out there who may, by chance, be reading his posts to be careful in their market activities. To consider all their best options, to be reminded that tricksters exists, etc., and not to jump blindly into the fray.
I wonder what the old man’s motive is.
Comment by Mike Landfair
Market Bugle
I don't agree with everything you say, but who does. You had a kernel of truth about the market and I took it in an another direction. If there's controversy, it only increases our readership and maybe we both learn something.
Thanks for stopping by.