Friday, June 24, 2011

the Crude Reality


In the wake of the SPR news yesterday, it's hard to deny that the powers that be don't appear motivated to prick the speculative froth from the commodity bubble. We can debate the merits or shortcomings of these moves from the CME's increase in margin requirements in silver to the Saudi's motivation to flood the market with more crude - the simple truth is they have likely contributed to the path of least resistance in the short term. 

Here is an updated chart from a few weeks back with one addition - I added oil because it is leading the way lower at this point. It seems like a foregone conclusion that silver - and by extension the respective currency pairs off of the us dollar will embark on their next leg lower.

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(Position in UUP)

Disclaimer: This is not investment advice. Always do your own due diligence. Erik Swarts is not a registered investment advisor. Under no circumstances should any content from this website be used or interpreted as a recommendation for any investment or trading approach to the markets. Trading and investing can be hazardous to your wealth. Any investment decisions must in all cases be made by the reader or by his or her registered investment advisor.