LOL. Just some chart readings and experience. Some people read crystal balls I read charts.
I think 115-117 is still the magic range. I think the bulls capitulate at this range and the shorts take over for awhile possibly pushing it down $100.
I think there is about a 70% chance we see $100 before we see $150. This is up from 65% a few weeks ago. So, there is still a chance we'll see $150 before $100 but I believe we'll see $100 in the third quarter of 2008.
Do you see how the markets reacted to Eduardo? The bulls try to move the price up in the morning and got bitchslapped by the end of the session.
My biggest joy is the bitch slap the bulls got on natural gas. It's down 34% from its peak in June and trading around where it was last November or so. I was talking to someone at a retail provider of electric that was telling me they were hedging 50% of their natural gas (when it was at its peak of 13.50/mmbtu) because it was just going to keep going up. I told him they were crazy and were going to be eating alot of natural gas (the best was it would see 10.00/mmbtu before 15.00/mmbtu). Got a case of beer out of the deal.
The bigger dilemma facing the US is our consumers. I believe we, as a population, are about to disappoint our fans across the world by spending less, borrowing less and saving more. If we return to half the savings rate of 1992... we'll take 346 billion out of our typical consumption (Wal-Mart sales for last year were around that figure!)
Not saying that is a bad thing. Saving more and borrowing less is ultimately a good deal. But the world isn't going to know how to react! It does setup a possible turn around for financials although I still wouldn't bet on financials at the moment since I think the second wave of defaults on mortgages (the alt-a's and prime's) are about to occur.
Interesting times in the US.