Crude tech update – weekly 13 in red alert for bottom

The weekly 13 finally showed up and if you have shorts its time to cover. Longs can slowly build up longs as one factor does not call for big urgency that is the Dollar which still needs to make its highs. In any case as also the CRB weekly has the weekly 13 count the commodity complex is building the botom and is in the final stage. One strategy which applies at this stages is to sell puts if you are not leveraging its a sound way to play the bottom building. It might take another 2-4 weeks for the crude to rise substantially as the Dollar needs to turn around but that might be around yearend earliest. I think that parallel the bottom of the stockmarkets will be seen more or less and as people recognize that there is no yearend rally ( other than the window dressing manipulation in the last week) more selling pressure might lure a capitulation trade again. Plenty of speculation money went out of commodities as they had tremendous losses and banks shut down their prop-trading operations. Many endusers have bad hedges as some airlines and others bought at highs the supplies which is another factor that no natural buyers show up as well for now.

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~ by behindthematrix on December 3, 2008.

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