Oil tested the 10 DMA and has bounced violently today. I’m about 99% convinced the intermediate cycle low is complete. Oil should reach $70-$80 during the second half of this year.

When the energy stocks break out of their 3 1/2 month consolidation box this will be where the next big trending move will occur. Miners have already delivered a monster move. Now it’s time to look at another sector for a bit.
oil has probably bottomed
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  1. Alexandru Popovici

    yes, indeed, Gary.

    in the meantime, just dumped all stocks and I am 100% in cash waiting:
    – for the DCL in stocks to reload strong uptrending stocks, such as stocks in the hype of this bull market: CLOUD stocks,
    – for treasuries to cater one short leg-up before re-shorting them.

    I give strong credit to your pro-energy call, so that I’ll make a rare move of going into an energy etf once stocks’ DCL clears for me.

    1. victor

      Hi Alex, so you think DCL in stock is not done yet? then, oil should follow lower too…, and what do you mean CLOUD stocks if not a secret ( : …
      also, you see what SLP are doing… , it’s up and up now…

  2. Alexandru Popovici

    Good morning, dear Victor!

    DCL in stocks is not done yet. We’ve only experienced a HCL which was foreseeable.

    I agree with Gary that the ICL in oil and CRB index are done, so that stocks’ decline towards DCL should not provide a lower low for commodities’ complex in general and for oil in particular.

    SLP fell in February immediately on ex-dividend date as smart money decided to shake the stock out using the delay of SLP’s release of its new software –> it was supposed to be released in winter and now SLP’s management said it would release it this quarter….
    Therefore, SLP is still a very risky trade for me, for my strategy – I prefer buying it much more expensive but with a considerably lower risk.

    Cloud stocks are companies that employ cloud-related solutions, such as BCOV, GIMO, QCOM.

  3. Alexandru Popovici

    as an example of greater opportunity and lower risk has been my advice TO STAY OUT OF BIOTECHS, LABU and the like and focus instead on strong stocks which proved leadership INSTEAD OF ANTICIPATING LEADERSHIP BY BOTTOM-FISHING.

    In this regard, I was touting ERI as a marvelous stock and indeed ERI skyrocketed or at least halted while IBB and LABU were testing their February lows at the end of June –> there’s always a lot of volatility at bottoms while there is little for strong stocks bought arround ICL’s or at least DCLs of stock broad indexes.

  4. Alexandru Popovici

    Your’re welcome, Victor!
    Good luck!

    PS: as expected and shared above, treasuries have resumed their small up leg 😉 waiting patiently to drop my short

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