Before I begin...
"Chart traders have no reason not to continue buying, at this point. The crude oil chart presents a classic bullish picture with more to go." Quoted from this article by John Kilduff on cnbc.com.
"$150 crude oil seems a virtual certainty, but it may prove as fleeting as a snow cone on a hot summer day."
He also added another statement to cover both side of oil story. But the thing I want to point out is the phrase that he uses - a classic bullish picture. Well, you remember a post 6 weeks ago (I'm lazy to find it), he says that oil was showing a topping chart. In 6 weeks alone, a topping chart has turned into a CLASSIC BULLISH picture, how amazing is that? =)
John P. Kilduff Senior Vice President Of Energy at MF Global Ltd.
Gold and more Gold
I urge most of you out there to buy gold right now.
Reasons being:
1. I see inflation everywhere. I don't know how is it around your neighbourhood but prices are rising sharply around mine. Personally I think the economists underplay the inflation data. When necessities like food and oil are rising sharply, I think inflation is pretty bad.
2. I can't see the dollar picking up. Well, the Fed can improve the dollar position by raising interest rates but I don't think that the Fed will raise interest rates in the near future. In addition to weak dollar, I think the Fed is printing too much money.
3. Gold is a laggard among most commodities. Well we all know that commodities have an awesome bull run for someting like 7 years. Comparing metals with metals, by my own logical sense I compare gold with silver. After all, silver was used as a form of money back then with sterling pound. Maybe silver has a lot of industrial uses than gold but the divergence is quite large actually.
4. Well, most people say that oil has a nice correlation with gold. Oil up = higher inflation = looking for anti-inflation asset = gold up. I think this is the logic and in my opinion, I can't see oil coming down yet. So if oil is not coming down, gold has to go up.
In the short term, there will be some deviations here and there but looking it from a long term perspective, they have a strong and positive relationship. I took this picture from this article actually. A good article actually if you have the time to read.5. This is a gut feeling reason actually. I think gold is not shooting so much because the hype is about oil right now. The momentum is with oil and when oil consolidates for a period of time (I don't think it will correct so soon), money is going to go into gold.
Others
Earnings season kicks off again next week with GE on friday. De ja vu? Well, I am negative about the market so I can't be bothered with earnings actually. I have shorted what I need to short and will stay that way for a while.
Oh ya, about vietnam situation. Read this. Headline is "Vietnam Dong Investors Use Black Market for Dollars".
Performance to date
| Name | Price shorted ($) | Current price ($) | % Change |
| Lehman Bro | 24.15 | 22.85 | -5.38 |
| General Motors | 13.99 | 10.12 | -27.66 |
| AMR | 6.22 | 4.83 | -22.35 |
| Citigroup Inc | 19.40 | 16.82 | -13.30 |
| Fannie Mae | 21.51 | 18.78 | -12.69 |
| AIG | 27.82 | 26.24 | -5.68 |
| Capitaland | 5.85 | 5.79 | Pathetic |
| CityDev | 10.20 | 10.90 | OMG +6.86 |
| SGX | 7.16 | 6.68 | -6.71 |
| Commodities | Price bought ($) | Current price ($) | Profit/loss ($) |
| Gold | 884.80 | 935.70 | 50.90 |
| Oil | 135.15 | 144.13 | 8.98 |
Get inside information from the president and you will probably lose half your money. If you get it from the chairman of the board, you will lose all of your money.
Jim Rogers
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