CL Redux

U.S. Stocks Slide on New Europe Debt Concern

http://www.bloomberg.com/news/2011-...-fed-s-pledge-to-keep-interest-rates-low.html

‘Spiral Down’

“It’s a spiral down until it stops,” Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia, which manages $1.2 billion, said in a telephone interview.

“We’re going through these constant day-to-day battles over
a) Europe’s debt crisis,
b) a downgrade in the U.S.
c) and a weakening economy.

There’s no positive sentiment regarding a light at the end of the tunnel.”
 
As I was waking up this AM I heard them say on the radio that one of the major French banks was down 15%, one 9%, and one 7%. And Sarkozy had come back from his vacation to deal with it.

Here's DX for the day on a 30 min.
 

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Quite impossible for me to be confident about a direction here. Since the high up top was yday's high, last week's low, and since we did not thrust as high relatively speaking in relation to the higher lows (see earlier 15m channel I posted), I am inclined to believe a drop down to 78 or lower is in order. Also, the falling EMAs on all time frames and VWAP also make me bearish.

However, we are still above that lower channel line and only shot through it 20 ticks. This makes me feel bullish.

So, I'm unsure and this range continues. The volume is still quite decent, but supply/demand quite in balance as we are smack in the middle of the day that has wound up having quite a low range relative to recent activity.
 
Fed to keep interest rates low until 2013

http://money.cnn.com/2011/08/09/news/economy/federal_reserve_meeting/index.htm?hpt=hp_t2

Among those surprises were dissension among the ranks of the central bank,
a) a "considerably slower" reading on the economy,
b) and a bold statement that the Fed stands ready to enact further stimulus measures if needed.

Interest rates: The Fed indicated it plans to keep "exceptionally low" interest rates in place until at least mid-2013 as a way to continue to prop up the recovery.

The federal funds rate is the central bank's key tool to spur the economy and a low rate is thought to encourage spending by making it cheaper to borrow money.

The Fed has kept the rate near zero since 2008, but has long been ambiguous on its future timeframe, saying it would keep the federal funds rate near zero for an "extended period."

The new two-year time horizon was an unusual move because the Fed doesn't typically signal its policies that far in advance, and because it was interpreted as an admission that the economy will remain weak until then.

"It surprised me that they boxed themselves into a corner that way," said Professor Steve Wyatt from the Farmer School of Business at Miami University. <b>"It essentially tells markets that they don't see any hope that we will see a stronger economic recovery in the next two years."</b>
 
DX came off it's highs right after I posted that last chart.

Futures Movers

Aug. 10, 2011, 11:19 a.m. EDT

Oil adds to gains on surprise inventories drop
Department of Energy weekly supply report matches trade group’s

By Claudia Assis and Sarah Turner, MarketWatch

SAN FRANCISCO (MarketWatch) — Crude-oil futures rebounded Wednesday after steep losses in recent sessions dragged prices to their lowest in nearly a year and a supplies report showed a surprise decline.

Oil for September delivery (NMN:CL1U) rose $1.05, or 1.3%, to $80.34 a barrel, leaving session lows after the inventories data. The contract traded as high as $82.90 a barrel and as low as $79.73 a barrel.

In regular trading in New York on Tuesday, oil futures dropped $2.01 to finish at $79.30 a barrel, the lowest price since late September.

Prices got a shot in the arm after the Energy Information Administration reported crude-oil inventories declined 5.2 million barrels in the week of Aug. 5, matching a trade group estimate out late Tuesday.

Analysts polled by Platts had expected both reports to show a rise by 1.8 million barrels.

The EIA said gasoline supplies decreased 1.6 million barrels, and stockpiles of distillates, which include diesel and heating oil, were down 700,000.

Gasoline for September delivery (NMN:RB1U) added 3 cents, or 1.1%, to $2.70 a gallon. September heating oil (NMN:HO1U) advanced 5 cents, or 1.8%, to $2.82 a gallon.

The analysts surveyed by Platts had expected gasoline stocks down 1.2 million barrels, and distillate stocks up 1.2 million barrels.

Investors have fretted demand for oil would drop in the wake of slowing global economic growth and sovereign debt woes amid plentiful supplies worldwide, even accounting from loss of Libyan oil as exports from the war-torn country continued to be off line.

Crude futures have shrugged off steep declines for U.S. equity markets. Both assets ended higher on Tuesday after the Federal Reserve said that it would keep interest rates at ultra-low levels into 2013. See report on Federal Reserve statement.

Earlier Wednesday, the International Energy Agency trimmed its 2011 forecast for global oil demand by 60,000 barrels a day, citing the impact of high oil prices and slowing economic growth.

The Paris-based IEA raised its estimate for 2012 demand by 70,000 barrels a day due to higher expectations for oil-fired power generation in Japan. Global oil demand is expected to average 89.5 million barrels a day in 2011 and rise to 91.1 million barrels a day in 2012, according to the IEA’s monthly oil market report.

On Tuesday, the Organization of the Petroleum Exporting Countries slightly cut its own forecast for world oil demand in 2011 and 2012, while the EIA kept theirs the same.

Energy analysts at MF Global said that keeping growth on track in as many countries as possible will be key going forward.

“In a best-case scenario, we would like to see commodity prices settle into a sideways trading range for the balance of the year at relatively low levels; this would help keep inflation at bay and allow central banks room to back away from further rate hikes,” they said.
 

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Quote from InvestVision:

Fed to keep interest rates low until 2013

"It surprised me that they boxed themselves into a corner that way," said Professor Steve Wyatt from the Farmer School of Business at Miami University. <b>"It essentially tells markets that they don't see any hope that we will see a stronger economic recovery in the next two years."</b>
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That's it. They were sort of between a rock and a hard place. They didn't want to be too bold and spook the markets by going for a Q3 or anything. And everyone knows what's up anyway. Things are bad.
 
Quite frustrating this--finally we break a trend line to the upside, it pulls back to .43, and I place my limit at .35 waiting for a TL retest... which never happens. A hundred ticks later in 5 minutes, and I'm not on the train. Oh well.
 
Quote from JoshDance:

Quite frustrating this--finally we break a trend line to the upside, it pulls back to .43, and I place my limit at .35 waiting for a TL retest... which never happens. A hundred ticks later in 5 minutes, and I'm not on the train. Oh well.
More...
Tired today and my heads not in it. Made some money on the bounce off the bottom, but missed especially that last jump. 1 full point in 5 mins.

We were posting at the same time JD, with the same results. :) Oh, well. :) Onward.

ADD: I had closed out my earlier long off the bottom @.56 and missed the approx .76 while I was posting here. Oh, well. We'll be okay.
 
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