Sean’s Rant

I called this bull market in oil. Heres my post when oil was at $35/barrel. I am not as bullish on it now because of the massive run up we have seen. I still see it going up in the long run but there has got to be a correction because the supply funadmentals still don’t support the bullish action. There is still way too much oil sitting around for it to be at these levels. I wouldn’t necessarily short oil but I would wait for a bit to buy more of it and you can do this with USO.

If you look at the track record of market behavior around this time of year, the recent rally represents the trend upward the last week of November. Also, we had just had a large downtrend, allowing for a large rally. We will likely see a down week of -500 points or more unless some major good news comes out, like the recent statement of Treasury Chairman Paulson to make a massive capital infusion which almost immediately lowered Mortgage rates. The day that this was announced the market was basically flat. This is because the market was due for a downturn to balance out some of the rally it had just experienced. When Paulson made this massively bullish news, it balanced out the activity for the day and left the market essentially flat.