A Quick View On Energy

Yes I' bearish on the global economy which would imply lower energy prices, but A) nothing goes strait down and B) commercial hedgers are more long than they have been in a year. The latter is a stat that served me well this year when playing the group. The commercial guys are considered the "smart money." Thanks to my oil pit buddy Joe.

Talking Your Book

Even T. Boone is having problems. I've always loved Boone and still do. I've followed him from his Mesa Petroleum days and have even spoken with him on the phone a few times. He has forgotten more than I could ever even comprehend about energy, but I still think we hit a $100 bucks.

Oil Inventory # On Deck

It should give oil an excuse to make a move. Which way? Just be ready.

Tuesday Morning Look

Oil futures are up about $1.50---again, even though there is enough oil to fill up Giants stadium just sitting in San Francisco bay this morning. New homes sales are out this morning and everyone seems negative on financials . UBS is looking for more pain ahead and Dick Bove, the Dennis Gartman of financials is very negative on the group. I just don't see meaningful upside with financials under pressure and energy in such a strong uptrend. As we all know things can change on a dime around here so let's stay ready.

Should Be A Tough Day

Oil is ticking at around $124.80 as I write and world markets are getting a cold slap in the face this morning. AIG should set the stage for a pullback in the financials. Citibank may shed $400 billion in assets.They have a $2 trillion balance sheet. What a monster company. I think they will let some air out today as there isn't a positive catalyst in site, and oil prices are really starting to piss the market off. With most earnings out of the way and commodities soaring it may be a good time to step aside or increase short exposure. Keep an eye on yesterdays lows to see if they are violated. I think they will crack. Critical juncture in the market as the rebound could be seriously tested here.

I guess folks that think inflation is contained( uncle ben) ride bikes and don't eat.

Morning Check

Bank of America posts a 77 cent loss and adds $3 billion to loan loss reserves. Oil is about flat but looks like it wants to tag $120 at least. Futures are off slightly. I will be posting day trade thoughts on twitter but they also appear on the upper right section of the blog. Good luck today folks.

Strong For Financials

I am short a one third position on PCU at $104. GLD looks pathetic and OIL is rolling over again

$104.50

That's where the oil traders see support. A break and we'll see $100

Staying Short Oil !!!!

Down $6 at $104

Fed Loans To Non Banks First Time Since 30's

Ominous at best.Watch for Goldman Sachs to surprise us this week. If they pull a fast one here all bets are off. Joe Lewis has now lost about $1.2 billion on his BSC investment. The Fed will do what they have to do, let's hope it's not too late to have an impact Gold is oil are higher here. I will be watching my oil short closely as I still have a little room on the stop.

OIL

This an e-mail I received from my very good pal who trades oil on Friday. Depending on whether you are a contrarian or not will form your opinion. The FED cut this week may or may not boost the price of oil. I still believe the dollar will tell the story and that it will rebound soon and oil prices will dive. This week will be interesting for sure. E-mail below





253--Non-commercials continue to buy NYMEX crude futures: CFTC report

New York (Platts)--14Mar2008/415 pm EDT/2015 GMT
Non-commercials, which are primarily comprised of hedge funds, added
13,768 contracts of crude futures on NYMEX, leaving them long 113,307 lots as
of the week ending March 11, according to data released Friday by the
Commodity Futures Trading Commission.
This was the largest long position since the week ending July 31, 2007,
as the continued buying by non-commercials pushed prices up towards the
$110/barrel level. Non-commercials were also establishing or adding to longs
in the options market just days before the April option expiration.
Commercials, which are comprised of oil companies, refiners and banks,
bought back 10,881 contracts of crude futures, lifting short hedges as prices
were racing towards all-time highs, not normally a trading strategy employed
by this group.
Non-commercials added 5,725 RBOB futures, leaving them long 51,175 lots,
just 2,000 contracts shy of the largest long position in this particular
market. Non-commercials liquidated 2,973 contracts of heating oil futures,
just prior to the market breaching the $3/gal level and hitting an all-time
high of $3.2220/gal.