Oil the New Gold — Purchase When There’s Blood within the Streets | Mish’s Market Minute

A weaker labor market, manufacturing manufacturing slowing, new dwelling costs falling and crude oil inventories rising greater than anticipated are all guilty for the massive drop in oil costs. US additionally eased sanctions on Venezuelan oil.

That is the character of commodities; contemporary information can supersede older headlines and pressure the weaker longs out of their positions as we noticed right this moment. However…

Thanksgiving journey will goose demand. So will the decline in crude floating storage. Tankers holding crude are been on the lowest ranges in 2 ¾ years.

India has elevated consumption. OPEC+ will proceed cuts of manufacturing.

Choose your facet. I’m going with “oil is the brand new gold.”

The futures contract (December) seems oversold and into help at $72.00 per barrel. The USO ETF chart simply broke the July 6-month calendar vary excessive (horizontal inexperienced line) and is wanting oversold. Extra importantly, 67 is large help so we’re shut if not on the backside.

And if oil is the brand new gold, you purchase it when it seems terrible, and promote it when it seems sturdy.

That is for academic functions solely. Buying and selling comes with danger.

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• S&P 500 (SPY): If 450 clears, seeing 465. Underneath 450, 435 help.
• Russell 2000 (IWM): 181 resistance, 174 help.
• Dow (DIA): 360 resistance, 346 help.
• Nasdaq (QQQ): 388 should clear and 370 should maintain.
• Regional banks (KRE): 45 large resistance.
• Semiconductors (SMH): 160-161 now pivotal.
• Transportation (IYT): 235 help.
• Biotechnology (IBB): 120 pivotal.
• Retail (XRT): 65 resistance and 60 pivotal help.

Mish Schneider

MarketGauge.com

Director of Buying and selling Analysis and Training