Tag Archives for " Oil "
The Trouble With Crude Oil
The action in crude oil has been hideous as of late, as you can see in this weekly chart: To be fair, it doubled in a year, so some profit-taking may be in order. However, let’s hope it can resume the uptrend, or at least hold the uptrend in the $46-$47 area. The oil rebound off the $26.05 February 2016 low played a huge role in last year’s rebound. There’s been no volatility in 2017 but oil is certainly a candidate for messing up the party. Remember, oil affects a lot more than energy stocks. Many regional banks have large energy loan books, and weak oil means more defaults. There are also an awful lot of high-yield energy bonds that would suffer. And historically, weak high-yield markets means trouble for the broader equities market. For now, the bulls remain in firm control, but oil could inspire the bears to finally step up after getting destroyed in the post-election rally.
Continue Reading -->Morning Call Express: December to Remember?
In today’s Morning Call Express, Scott Redler welcomes us to a new month and updates the action in the SPX. He also looks at the recent move in oil and some of the levels to be watching heading into today’s action.
Continue Reading -->Morning Call Express: Oil Grease The Bears
In today’s Morning Call Express, Scott Redler talks about oil as it seems OPEC will reach a deal. He also reviews the chart of the SPX and how it looks as we move into the final month of the year. Scott also looks at the Energy ETF (XLE) and the clues that it was giving ahead of the OPEC meeting. He also looks at high beta tech names ans how they are looking.
Continue Reading -->Morning Call Express: Cyber Monday
In today’s Morning Call Express, Scott Redler looks at the SPX and talks about where the markets are at this morning, and the move up we have seen the last month. He also looks at oil (USO), Amazon (AMZN), Apple (AAPL) and others.
Continue Reading -->Morning Call Express: Wall Street Stocks Look for Direction
In today’s Morning Call Express, Scott Redler talks about the post election action in the market as well as various sectors. He reviews the action in the SPX over this year and what it would need to take in order to see all-time highs. Scott also looks at a couple of sectors, as well as banks and a few new issues.
Continue Reading -->What’s Happening: Anti-Trump?
Over the past couple of days, we’ve seen the big Trump trades start to reverse themselves a bit, with bonds rallying, financials falling, biotech dropping, and gold stabilizing. Bonds are up again today ahead of Yellen’s testimony, and odds are she’ll be asked about Donald Trump’s proposed economic policies. But since the Fed strives to appear apolitical, I doubt she’ll give anything concrete. Already this week, many Fed officials have been asked about Trump and many have been evasive, though there’s a growing consensus that Trump’s spending plans could give the Fed room to raise rates. The CBOE’s FedWatch Tool shows that traders are pricing in a 91% chance of a December rate hike. Oil is rallying on Saudi optimism regarding an OPEC deal. Yesterday, Russia offered similar vibes. OPEC reached a preliminary agreement back in September at the meeting in Algiers, but didn’t provide any details. Maybe it’s for real this time, but I wouldn’t count on anything until there’s an official announcement. Throughout 2016, we’ve seen a lot of false rumors and conflicting headlines, so try not to get too caught up in the chatter. Wal-Mart (WMT) is getting spanked on a same-store-sales miss, though Best Buy (BBY) is popping hard on a beat. Overall, markets feel compressed, which is a familiar theme this year. We get some exciting news (election, Brexit, etc.) following by a long string of back-and-forth nothingness as traders wait for something to happen. The VIX is at 13 and change, but 20-day realized volatility on SPX is at 10.6. So unless we get big moves soon, the VIX could easily drop back under 12.
Continue Reading -->Morning Call Express: Stalling or Digesting?
In today’s Morning Call Express, Scott Redler reviews markets around the World as well as the U.S. Markets. The question to now answer is; are we seeing a digestion or stall? Scott looks at various sectors as well, including USO and XLE.
Continue Reading -->Morning Call Express: Question Marks
In today’s Morning Call Express, Scott Redler paints a portrait of the landscape out there as the markets are taking a little breather this morning. He provides the levels that he is looking at for support and what would need to happen to begin changing trends. Scott also looks at high beta tech which was able to close green yesterday and the strong move up in oil.
Continue Reading -->The Morning Hammer: Ahead of the Fed, Markets Show Fear
Global markets are rallying this morning as commodities rebound and the dollar retraces ahead of Wednesday’s big FOMC rate policy announcement. Traders are pricing in a mere 20% probability of a hike this Wednesday, so traders will mostly be looking for clues to see if the Fed moves in December. Europe is up nicely despite continued weakess in Deutsche Bank (DB) which is facing liquidity concerns due to the DoJ’s demand for a $14 billion payment to settle an MBS dispute. In Asia, the overnight interbank yuan rate skyrocketed amid speculation that China’s central bank is intervening to boost its currency. Traders are also shaking off terror concerns in New York City. Over the weekend, explosive devices were set off in New York City and Seaside Park, NJ. Another devices was found in Elizabeth, NY. Venezuelan President Maduro said OPEC members are close to reaching an agreement on stabilizing the market. However, such an announcement is likely not forthcoming at the September meeting next week. OPEC’s Secretary General said September is a “meeting of consultation and not of decision-making.” SPX futures are modestly positive this morning, much to the chagrin of the bears. Sentiment is leaning modestly bearish right now. As always, the bears say everyone’s bullish and the bulls say everyone’s bearish, but the numbers (which too many people ignore) are all over the place. The 10-day moving average of the ISE Sentiment Index is 91, which points to modest bearishness. The CBOE equity put-call is 0.65, which is about in-line with the 6-month average. The AAII sentiment survey shows that 27.9% of investors are bullish vs. a long-term average of 38.5%. The only data that really shows traders being complacent is the Investors Intelligence Survey, which shows that 49% of newsletter writers are bullish. So even though markets are just -2.5% off the highs, traders very quickly rushed to price in some downside. Volatility has returned to the market after 2 months of nothing, though we could end up in a holding pattern until Wednesday, which is not only has the Fed, but a Bank of Japan rate decision. There has already been chatter that the BoJ will go even further into negative rate territory. I’d love to get some excitement ahead of then, but I’m not counting on it.
Continue Reading -->The Morning Hammer: Is Today a Big Day?
I thought yesterday would be a big down day for the market with yet another string of economic data misses, and I was wrong. Equities were pretty strong yesterday, with nice action in biotech and large cap tech. This morning is another story. Deutsche Bank (DB) said the US Department of Justice is seeking $14 billion to settle its MBS probe. DB is not willing to pay that much and the stock is taking a bit hit. That’s helping push European banks down -2.4% in the early going, while the broader Euro Stoxx 50 is off -1.4%. In analyst-land, Nicholas Smith of CLSA said he is “absolutely certain” that the Bank of Japan will stop buying Nikkei 225-based ETFs to boost equities. However, said the bank will not stop buying — they will simply shift their purchases to the Topix and JPX-400. SPX futures are taking a -0.4% dip this morning, following Europe down. Apple (AAPL) is up premarket as iPhone 7 goes on sale. Canaccord also raised its target price to $140 from $120. However, the big news today is the CPI report which hits at 8:30 a.m. ET. The market is split right down the middle on rate hikes. Fed funds futures imply a 50% chance of a December rate hike, down from 60% last week. Economic data has been slipping hard since the July 29 GDP report, and it seems like traders just started paying attention to this important trend. This CPI report will be the last major economic data release before the September 21 rate decision, so there’s a chance we end the week with a bang. The only problem is we can’t figure out what kind of bang. Yesterday, we got a huge batch of dove-supporting bad data and gold and US Treasuries still fell. And equities seem to be reacting randomly to Fed chatter and data too. So even if you gave me the numbers now, it still wouldn’t be easy to trade this CPI report. Near-term, I’d keep a very close eye on Apple (AAPL) and biotech because they’ve been holding up the market. Apple’s got a chance of a sell-the-news reaction today as we see 10 million news reports about iPhone sellouts. Biotech’s still a wild card because the whole sector is moving on takeover chatter surrounding individual companies. Today is also quad-witching options expiration, so get ready to hear everyone’s cockamamie theories on what it means for the action. (I think it’s completely random) I’d also keep an eye on oil. Good luck out there!
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