CL Redux

Quote from ammo:

if dis does dis
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The euro has already corrected down to the middle of the range (1.2-1.6)... if it indeed goes down by 1/4 of its range more, then Rogers will come knocking for cleavage:)
http://jimrogers-investments.blogspot.com/2011/05/i-own-euro.html

(he also said he wasn't selling any commodity currencies due to the May correction in commodities, but I did find one post-correction admission about not adding any oil - not the same as selling - and his target is around 200, this man is mad!)

Besides, the causality (between DX -> CL or CL -> DX) is not really there... nothing more than a negative correlation between the dollar and oil (and other commodities), they simply trade off the same inflationary drivers:
http://www.theessentialsoftrading.com/Blog/index.php/2011/05/13/which-is-leading-the-dollar-or-oil/

One cannot say for example that the euro crisis (which brought it down -20% in a straight line without any retracements) made much harm to crude oil... in fact it made new highs twice, staging two +20% rallies in the same period (each of them equivalent to the current -20% drop from the top), and only the final euro capitulation phase (when it went down -10% in a single month) did coincide with (not necessarily caused) oil to drop outside its trading range (a drop from the top by -20%).

A carefully selected example when the euro-oil correlation broke down would be the -10% drop in euro in Nov '10 - Jan '11 during which crude oil in fact went up by the same percentage. I hope that helps in avoiding any longer-term decisions based on that supposed relationship (which can hold for three hours like it did last Friday, but not for days and not for investment horizons).
http://tinyurl.com/5uyw39m
 
<b>NYMEX-Crude rises as shorts cover, ends week higher</b>

http://www.reuters.com/article/2011/05/13/markets-energy-nymex-idUSN1319108820110513

* Late short-covering lifts crude, erases session losses
* U.S. gasoline up, but ends week down on demand worries
* China to suspend diesel exports to conserve supply
* Coming up: API weekly stocks data, 4:30 p.m. EDT Tuesday

NEW YORK, May 13 (Reuters) - U.S. crude futures rose near
the close on pre-weekend short-covering to end higher on
Friday, after falling earlier as the dollar rose and on reports
that Libyan leader Muammar Gaddafi had been wounded.

In early trading, crude futures climbed back above $100 a
barrel, bolstered by positive euro zone GDP data, but gave back
winnings as the then-weaker dollar shot back up on caution
ahead of key EU financial ministers' meetings on Monday.

<b>Reports that Gaddafi had been wounded helped pressure
prices, even though it was quickly denied by a Libyan
government spokesman.</b> [ID:nLDE74B2KJ]

FUNDAMENTALS
* On the New York Mercantile Exchange, crude for June
delivery CLM1 settled at $99.65 a barrel, up 68 cents, or
0.69 percent, after trading between $97.09 to $100.70.

* For the week, front-month crude rose $2.47, or 2.5
percent, staging a small recovery from the $16.75 record weekly
loss in the week to May 6.

<b>* Alon USA Energy (ALJ.N) on Friday continued building a
second levee to shore up existing levees around its 80,000
barrels-per-day refinery in Krotz Springs, Louisiana, which
could face supply disruptions or have to shut down amid
flooding after the Morganza Spillway opens. [ID:nN13194756]

* Money managers cut their net-long U.S. crude futures and
options positions by 38,109 contracts to 255,713 in the week to
May 10, the Commodity Futures Trading Commision said.
[ID:nEMS26LQNZ]

* The most recent big drop in oil prices was likely caused
as much by short-selling as by investor liquidation, according
to data released on Thursday that suggested more volatility
ahead for commodity prices. [ID:nN12289634]

* The International Criminal Court prosecutor will request
arrest warrants for Libyan leader Muammar Gaddafi and two
others on Monday, Spanish radio station Cadena Sere reported
from Madrid, citing ICC sources. [ID:nLDE74C28P]
</b>

MARKETS NEWS

* Wall Street closed lower for a second week, reflecting
growing worries that equities are on the precipice of a
pullback. [.N]

* The dollar climbed to a six-week high aginst the euro as
concerns about the global economy spurred a return to the
greenback's safety. [USD/] .DXY

* Gold fell, reversing sharp session gains as the dollar's
rise against the euro and renewed uncertainty ab9out euro zone
debt prompted investors to sell ahead of the weekend. [GOL/]

* Copper firmed at the close, after upbeat data from the
U.S. and Europe helped restore some market confidence and
economic recovery optimism. [METL/]

Quote from InvestVision:

KID , good multiple LONG calls from 97.0 level from your side ...

----
Oil settles higher after late-hour comeback

http://www.marketwatch.com/story/oi...y-above-98-a-barrel-2011-05-12?dist=afterbell


SAN FRANCISCO (MarketWatch) — Crude-oil prices settled higher on Friday, staging a comeback in the last hour of floor trading to secure weekly gains of 2.5%, its best since early April.

Gasoline futures edged up as fears the Mississippi River flooding could disrupt refinery production over the weekend helped prices move higher.

<b>A rising dollar pressured oil and other commodities most of Friday, taking the spotlight in the absence of pressing news or other catalysts, analysts said.</b>

A stronger dollar is negative for commodities as it makes them more expensive to holders of other currencies.

<b>
“For those with thicker skin, we continue to remain biased towards the short side, especially if the U.S. floods that are expected to hit the South East in about 10 days time do not damage a number of refineries that lie along the route,” analysts at MF Global said. “That is a big if for now.” Read about refiners gearing up to battle acts of nature.
</b>

A gallon of regular gasoline retailed for an average of $3.982 Friday, slightly below Thursday’s $3.984, according to AAA’s Daily Fuel Gauge Report.

“People are unwilling to go short (on heating oil and gasoline futures) just in case something happens over the weekend,” said Hamza Khan, an analyst with The Schork Group in Philadelphia. “A lot can happen in two days.”
More...
 
<< I think here they are talking about drop from 112 levels where heavy SHORT selling occurred in addition to LONG Liquidation ...by BIG funds.

So Friday like price dump in the early hours and short cover in the late hours will be common ( not exactly in that order ) in the weeks ahead as suggested by the report below ..
>>

* The most recent big drop in oil prices was likely caused <b>as much by short-selling as by investor liquidation,</b> according to data released on Thursday that suggested more volatility ahead for commodity prices.
---------------

* Money managers cut their net-long U.S. crude futures and options positions by 38,109 contracts to 255,713 in the week to May 10, the Commodity Futures Trading Commision said.
[ID:nEMS26LQNZ]
 
http://www.marketwatch.com/story/oi...-trading-2011-05-15?link=MW_story_latest_news

“The indication being he was very pro-financial-aid for Greece and that somehow this will make things a little more difficult to resolve,” said Roland Randall, strategist at TD Securities. “It’s just another level of uncertainty,” he said.

<b>Commonwealth Bank strategists said: “The IMF/European Union finance ministers meeting tonight will be important for resolving market concerns about Greece.”</b>

The Barclays Capital oil strategists said that they believe concerns about peripheral issues “are unlikely to have any fundamental impact on the market, given the underlying balances remain constructive.”

External issues may continue to impact sentiment in the short term, keeping prices volatile, they said, but “the overall trend in prices should be higher.”
 
Quote from NoDoji:

stp to b/e, need to see break of 20 EMA here
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This trade BTW is a channel play, channel getting a bit loose with slight overshoots either side, setup based on triple touch resistance at the 60-min 20-EMA.

20 EMA on the 5-min is well-defended so far.

ADD: Failure to break down that 20 could result in an upper channel line breakout, but it's Sunday night and if I can't get a quick target, I'm outta here :p
 
Quote from NoDoji:

This trade BTW is a channel play, channel getting a bit loose with slight overshoots either side, setup based on triple touch resistance at the 60-min 20-EMA.

20 EMA on the 5-min is well-defended so far.

ADD: Failure to break down that 20 could result in an upper channel line breakout, but it's Sunday night and if I can't get a quick target, I'm outta here :p
More...

Out b/e. Good trading to all tomorrow!
 
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