It remains to be seen what this means for crude, but the XOI is in a bullish ascending triangle stance. I have been looking for oil to top out forever and a day, but if the XOI is any indication, it is not happening. Normal cycles appear to be getting disrupted by a market that seems to have Bernanke's (and Trichet's and all the rest) number. Global markets know these guys are in a box and competitive inflation is the only way out. The Fed is seen as weak here and no match for the global market casino. If this ascending triangle breaks out, the NatGas sector does likewise and heaven forbid the major indexes make new highs... I will prepare to abandon the gold above all else stance and add energies (beaten up Canroys are an option) and base metals to the mix liberally along with some LatAm and tech. We are institutionalizing an impotent and compliant Fed. Yes that is healthy. For now however, it remains gold above all else as financial hazards remain amplified.
December 12, 2007
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