Oil - short queeze?

It seems that the market is uncertain. It doesn't know whether to form a contango or a backwardation. I guess this is the impact of such a deep involvement of government in the market place.

Walt
 
Quote from nazzdack:

Flooding the market with dollars will usually be "bullish" for physical commodities.
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Is it because adding dollars causes inflation? I'm pretty new to this (just started swing trading futures last week), and believe it or not this was my only my second week trading currency futures. Today the euro went from +2000 to -1000 now to +1784 for 1 contract. That seems crazy. It did the same thing a few days ago.

Also, what about gas? Gas is down 1.36%. Shouldn't that be bullish?
 
1) Adding dollars diminishes the "value" of all dollars. More dollars ought to be required to buy the same amount of commodity.
2) Gas? You're refering to natural gas? Natural gas, on a relative basis, has held up better than crude oil since Hurricane Gustav.
 
Quote from cunparis:

Is it because adding dollars causes inflation? I'm pretty new to this (just started swing trading futures last week), and believe it or not this was my only my second week trading currency futures. Today the euro went from +2000 to -1000 now to +1784 for 1 contract. That seems crazy. It did the same thing a few days ago.

Also, what about gas? Gas is down 1.36%. Shouldn't that be bullish?
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Unleaded gas is riseing back near $4.00 here in Dallas from $3.30 last week.

All the money being pumped into the system is going to cause more inflation.

Just when things were getting better.
 
Quote from nazzdack:

1) Adding dollars diminishes the "value" of all dollars. More dollars ought to be required to buy the same amount of commodity.
2) Gas? You're refering to natural gas? Natural gas, on a relative basis, has held up better than crude oil since Hurricane Gustav.
More...

1 - makes sense. This was my idea earlier this week when I went long the euro. But it wasn't everyone's idea. The euro went down and the dollar went up. But now it looks like the euro is in the right direction (up).

2 - This is precisely why I went long gas. I could see the support on the chart. When I say gas is down, I mean this week. Oil is up but gas is down, which is weird because if it's because of potential future inflation gas would be up as well. I suppose inflation is just one variable and there are a lot of other things going on such as supply and reserve issues.
 
This is not that difficult to understand given the recent events.

It's basic supply/demand.

Crude Oil got weak because all of the refineries went "off-line" during Hurricane Ike.

They are mostly now back "on-line" and so they can now DEMAND/PURCHASE crude oil to process into gasoline and other refined products.
 
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