Showing posts with label Iran. Show all posts
Showing posts with label Iran. Show all posts

Wednesday, April 4, 2007

Timer Digest Commentary

Timer Digest CommentarySocialTwist Tell-a-Friend
Fari Hamzei

Yesterday we saw U.S. stocks close sharply higher as a drop in oil prices calmed worries about inflation and news of an unexpected rise in home sales raised hopes that the housing market is stabilizing. Unquestionably, the rumors of the impending freedom for British Royal Marines held captive in Iran since March 23rd, fueled the strong bid across BigCaps, TechLand and Small Caps. And as George W spoke in the Rose Garden, bashing the Dems, our favorite Defense stocks BA, NOC and RTN, provided us an early warning of the explosive move.

Good Friday has historically provided an up bias for the market; however next week, we expect some selling as we all need to meet our obligations to Uncle Sam by April 15th.

Wednesday, March 28, 2007

Timer Digest Commentary

Timer Digest CommentarySocialTwist Tell-a-Friend
Fari Hamzei

1410 on SPX is our next support.

Since we have not seen the much needed volatility retest (see my February 28th post, the current hostage crisis with Iran (British Royal Marines arrested during a routine patrol and taken to Tehran), coupled with Crude Oil Futures at six-month highs and the SubPrime Contagion, should be the impetus for this all crucial retest.

I suspect, unless Iran Nuclear Issue with the UN and this hostage crisis with the UK are resolved quickly, we will visit March lows (1364) and shake the trees till we get rid of the weak longs.

Crude Oil, VIX and S&P-500

Crude Oil, VIX and S&P-500SocialTwist Tell-a-Friend
Sally Limantour

The relationship between oil and stock prices is on the front burner again as prices skyrocketed with May crude oil trading to $68/ barrel. “Oil surged $5 in 7 minutes late yesterday on speculation the U.K. would mount a rescue attempt.” (Bloomberg)

As the situation between Iran and the UK gains attention and concerns over the stability of the Persian Gulf and the Straits of Hormez move to center stage we now have concerns over the US naval forces there. This many ships in the Persian Gulf are of great concern… but should we be surprised?

Back in late January I voiced concerns over the changing “guard” in the Middle East. For the first time President Bush was putting in a US Navy Admiral as the US Central Command Commander-in-Chief. Admiral William Fallon was appointed on January 30, 2007. That seemed suspect to me as what had been up until now a protracted land war was soon, in my opinion, “going to see water - lots and lots of water. Can you really have a navy admiral running things and not have some ships in the picture? The geography of this war may be shifting.”

Stocks are acting defensive. We have geopolitical concerns, a slowing economy and inflation in some of the commodity prices. My favorite trade is long gold/short stocks right now and will continue to hold this.

The VIX is still relatively low when looking at a monthly chart and I wonder how long the VIX will find support in the 12-13 area. Will it soon have a higher low – 15-18 as its support line as we move into heightened concerns in the Middle East and inflation kicks up?
The next two are market profile charts for S&P-500 and Russell 2000 e-minis . The long horizontal letters represent supply above the market.

Commodity Prices

Commodity PricesSocialTwist Tell-a-Friend
Sally Limantour

Commodity prices have been moving higher as all three indices are up. While many of the markets are higher, the grain prices are lower. Many of you have emailed me asking why in last week’s class I was liquidating all of my grain positions. What technical indicators were telling me it was over? Other than RSI being over bought and trading near the top of the BB it was really a money management decision. All of these markets – corn, wheat and soybeans are up exponentially since first accumulating long positions in September and with the USDA report looming ahead of us on March 30th, I felt it was prudent to say “Thank You” and stand aside. It is not often that prices double in a matter of months as we saw in the corn market. A lot is riding (both politically and economically) on this report, so why be a hero? We can always get back in and hopefully at lower prices.
The energy markets are all moving higher and crude oil is 1.0% higher, while RBOB gasoline is 3.4% higher. The world is watching the situation with Iran and the UK and concerns over the Persian Gulf and the Straits of Hormuz are moving to center stage.

The weather is getting warmer and driving season is upon us as the nation’s refineries are low on gas! The spreads are reflecting this tight supply as the nearby spreads are trading to a premium to the deferred spreads. This does not look like a tight situation that is going away anytime soon.
Any breaks into last week’s range I would be looking at buying. Also the May/ June spread at 8 cents/gallon looks possible with stops under 5 cents. (note you can look at the mini contract and the symbol is QU).

Finally with commodity inflation heating up it is looking more and more to me like the bonds could trade to the 109 area. I will be looking for set ups to go short.

Tuesday, February 20, 2007

PBS Interview -- Master Traders

PBS Interview -- Master TradersSocialTwist Tell-a-Friend
Fari Hamzei
February 20, 2007

We are thankful to AJ Monte and Rick Swope, co-hosts of Wealth & Wisdom with The Market Guys , who arranged for us to receive the master DVD of this interview recently. Last Fall, James DiGeorgia of Gold & Energy Advisor sponsored the W&W series. The interview was originally aired on October 20, 2006.

Video Part 1

Video Part 2

Video Part 3

Sunday, February 4, 2007

Crude Oil

Crude OilSocialTwist Tell-a-Friend
Sally Limantour
January 28, 2007

The energy markets had fresh news on all fronts with weekly prices closing higher for the first time since mid December. If you are trading energy you have to keep tabs on the weather, OPEC, MEND (Nigeria), Iraq, Iran, Venezuela, Mexico, stocks/usage and alternative energy news. It is a full time job!

President Bush’s State of the Union address last week called for, “twenty in ten” where he proposed cutting US gasoline demand by 20% in 10 years with plans to switch to alternative fuels by 15% and another 5% to be saved by increasing fuel-economy standards. He also announced a goal of using 35 billion gallons per year of alternative fuel by 2017. This is 7 times the current level and about 5 times the current Renewable Fuel Standard of 7.5 billion gallons by 2012. This is an extremely ambitious goal as there just isn’t enough US farmland in the US to produce that much corn.

The January reports from the US DOE/EIA and the monthly OPEC report showed demand growth forecasts were basically unchanged. There were, however, downward revisions in the non-OPEC supply forecast by the IEA which were cut by 300k/b in 2007. Talk of China building strategic oil reserves was an added bullish demand factor and it is now estimated that the US and China will account for over half of the world’s consumption growth in 2007.

This coupled with the colder weather patterns and violence in Nigeria all helped to prop up prices of crude oil after it briefly broke the $50.00 level. The sell off in crude oil from the highs of last August has occurred in two waves. The first wave occurred between August and late September as the market was working off the potential hurricane premium and it was exhibiting lower geopolitical premium. The second sell off happened during December through January and this was due to the warm weather and the rebalancing of the commodity index in January. What is next for crude oil? It seems that with speculation of a US military strike against Iran or a potential oil embargo in the air that perhaps crude oil has seen its low for now. The push to fill the Strategic Petroleum Reserve with initial purchases of 11 million barrels is also supportive. I am currently watching the crude oil from the long side. If we can hold above 52.50 and build support above $54 for a while the market could attempt a mildly bullish stance. Perhaps, at least this would silence those calling for $30 oil.

There is an interesting relationship with the CRB and energy. The crude oil sell off from the highs in August has caused the CRB to break important support levels. As a result many have claimed the commodity bull market is over. A closer look however shows that there has been a radical revision in the CRB index since July 2006 which has skewed the overall makeup of the index. This 10th revision now has oil making up 33% of the index and this has huge implications for those watching the CRB. I urge everyone to read the excellent piece by Adam Hamilton at ( titled, CRB Dominated by Oil, for a complete understanding of this change.

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