Week in Review: Just Plain Crude

The past week was all about oil with West Texas up over 13 percent on fears of political instability spreading into Saudi Arabia.   Every major stock market we monitor in the Week in Review was down with the German DAX taking the biggest hit, falling 3.25 percent and the Shanghai down the least, 0.74 percent.

We were surprised equities were not down more and that the Russell 2000 outperformed the U.S. majors.  The equity market appears to believe:  1)  the crude price spike is only temporal;  2)  is in denial;  3) believes the economy is not as vulnerable to higher oil price;  or 4) all of the above.

The S&P 500 made its intraday low for the week at 1294.96 on Thursday about 10 points above its 50-day moving average.  This is the level to watch next week.   The other market we’re monitoring closely is the Hang Seng which once again bounced off key support at 22,600.

The dollar was surprisingly non-bid during such an increase in geopolitical risk, which may be a sign the Fed is losing credibility in the global market place.   Gold was up 1.48 percent and next week will be a key test for the yellow metal.  Gold needs to take out last week’s high of $1,417.88 to challenge the all-time of $1,430.   This is chip shot from current levels and the only issue from a fundamental perspective to keep gold from making new highs is a hawkish Fed.   Technically,  gold has come along way in a short period of time, up over $100 in less than a month.

We’re keeping positions light and tight and watching key levels for direction.   Have a good week.  (click here if charts are not observable)

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3 Responses to Week in Review: Just Plain Crude

  1. Pingback: Week in Review: Just Plain Crude

  2. Pingback: Week in Review: Just Plain Crude — My Blog

  3. Chico says:

    Regular gasoline at my local station went from $3.12/gal on Sat to $3.21/gal on Sun.

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