A Look at Crude Oil
posted Dec 14, 2005 at 11:05PM
I am still working on the premise that crude is in the midst of a major consolidation that will last...well I don't know how long...but a while. It will take a form not unlike the HUI of the past few years...a wide ranging triangle/bullish flag.
At these prices it is easier for junior oil companies to start making money than it is for a gold mining company to start a mine. I guess that is why right now I do have a bias for junior oils...or at least the junior oil sands or when you get right down to it..at least one junior oil sand which I have already flogged on this site.
In short make sure your stock picks are "internally" good enough to be attractive to buyers even if oil wobbles up and down between this range.
I cannot see crude making new highs without the help of "unforeseen" events, especially involving increased military action in the MIddle East. Given the rhetoric coming out of Iran, you know that there are people there who are literally begging to bombed.