The one treat CNBC offered today was probably the best thing I ever saw on CNBC, Meredith Whitney from Oppenheimer. This is the only person I've ever seen who didn't sound like a squaking chicken"Do we do this? Do we do that?" She was clear, concise, consistient and cute.
As for the rest, they're talking about Oil like "was the drop in oil just a pullback, should we be buying oil?" after having no idea for weeks. In Saturday's video's I posted my analysis, oil will bounce this week. In the Contributor's Letter, I put a little bit of a finer point on it and gave the trades that went with it.
The interesting thing about this oil pop is this: technically oil broke down very badly and there was a lot of downside momentum and margin calls get triggered and that momentum builds. There was no technical reason really for a move up besides a bit of a wedge. My 3C indicator though has been calling this trade for over a week, I've been watching the accumulation build into the counter trend trade and that's why I brought it up. Monday I thought oil was off to a good start, Tuesday it made new lows and I was questioning myself, even in my letter I asked rhetorically if I had egg on my face and I went on to describe the only reason I could think of to save this trade.
This is where it gets interesting, and Dave and I had talked about this as well. I believe that the inventory report or the result of the inventory report was known in advance or leaked or planned or whatever conspiracy you want to plop in there. There's no reason to build such accumulation into a position that is falling like a rock without having a good, solid reason for doing so. There's not much more to say about it.
The market is gonna shake, jitter and jive this week with window dressing in effect and the GDP numbers tomorrow. The employment numbers come out Friday and then we'll have new monthly inflows. Overall, despite the cackling crows of CNBC, the market will move higher in the near term. We're still in a bear market so no, this is not the bottom.
Wednesday, July 30, 2008
CNBC, A Day Late and Lots-A-Dollars Short
Posted by Brandt at 4:55 PM
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