LNG has a long history of not getting any love.
Famously, in 1971...a Russian oil rig fell into a crater filled with LNG. They figured the best move was not to capture the LNG...but to use it to burn the oil rig. 50 years later...that crater is still burning...and is known as the Door to Hell .
LNG has often been thought of a cheap, plentiful energy...
Expect a lot of volatility in the oil market in the next few days.
Friday we had JP lean pretty dovish for his Jackson Hole speech bullish for price.
Many are taking the narrative that Hurricane Ida will disrupt oil production...thereby increasing crude prices. That is true enough. However, there is also refineries that have gone offline.
So it's not a one...
Oil has stayed within this long term trend channel since June of 2020. Today's -3% move placed WTI at the bottom of this trend channel $64.20
If we don't get a reversal here...I don't see another good support until $62.
This morning oil had an aggressive selloff...again...at $70.20.
The selloff was not just aggressive...but textbook.
Oil posted a 3 wave correction with C wave of equal length to A wave...stopping on the screws at 67.80.
There is a lot of accumulation happening now between $68.05 and $68.15.
There may be some stop loss hunting as the institutions soak up...
Last week Bitcoin had a great bounce off the $30k handle....and it was impressive!
Since then, I've seen a lot of bitcoiners on twitter calling for the 6-figure bitcoin soon. I tend to agree that it will go there...and much higher over time.
However, before we celebrate...a crucial hurdle must be cleared.
Resistance must become support.
So far...Bitcoin has...
Monday morning saw crude get crushed...down over 4%....with a current low print of $70.53.
Looks like the fib retracement is complete and should begin the advance back soon.
Order flow looks positive for the long setup.
On the fundamentals of why crude took a nosedive....I heard it was New Mexico production hitting all time highs. If that is the news....way...
Looks to me like oil is set for a 3 wave correction. With the OPEC+ talks on output and the future of the cartel in question...volatility will likely remain high.
Yet if this is a 3 wave correction...we should see a good support around $72.15 to go long.
The narrative around copper is very compelling.
1) $5T of Government spending in the next 10 years for renewable energy development
2) Electric cars
3) Miners underinvestment in recent years
What this says to me is the simple fundamentals from miners...limited supply would be enough to extend this commodity bull cycle.
Beyond that...we have car manufacturers...
Bitcoin was looking like it based all day today around $42,000 and just broke support.
This could be a simple "fake out", as I saw some numbers earlier that showed very little short interest at current prices. However, things change...quickly...and unexpectedly at times.
If this isn't a fake out...look for next support at $30,000.
After getting my morning entertainment on twitter...I've seen a lot of tweets like this....
"Buy the dip!"
And various versions of that sentiment.
First off....giving blanket advice...even if you put your disclaimer that your tweets are not financial advice...you need to understand that many people still take it as such. So we should be a bit more...
A common relationship in the 3 wave correction pattern is that "C" wave travels the same distance as the "A" wave. Not always...but it is a common relationship.
If that relationship holds this time...a target of $41,447 for this correction.
Since the pullback in bitcoin late last April, Bitcoin has formed an ascending triangle…printing higher lows with resistance around the $58,000 - $59,000. The past couple days it has come close to the psychologically important $60,000…only to be rejected with buying picking up at ever higher prices (Higher Lows).
But back on the short term technical…each time...
WTI has a surprisingly large pullback this am. Structurally...nothing changes with the trend.
Last Friday's low of $63.89 is still holding, as today stopped just short of that at $63.95.
With the rest of the energy complex printing higher highs...WTI price structure, and overall trend...I'm still looking for prices to head north of $67 shortly.
The EIA Crude inventory came out at 7:30 am.
Actual -7.990M Forecast -2.346M Previous 0.090M.
Very bullish for crude prices, reacted as expected until it hit $66.80 then slammed down. Overall...I expect the market to take out the $66.80 as we are now recovering. Still...one wild ride that happened in an instant!
Sometimes I just get lucky. I was waiting for a buying opportunity in gold and Yellen gave it to me this morning when she stated "rates may have to rise to keep the economy from overheating". Gold then plunged over $25 dollars after breaching the shorter term high.
#WTI #oil futures has been my favorite trade over the past few days. Technicals and fundamentals are lining up for higher prices. The fundamentals story is pretty simple...we are coming into the summer and COVID restrictions are lessening...so demand will be greater (and likely a greater rate of change than many previous years). On the technical side....it...