Almost immediately after I made the call that oil has made a temporary peak, trouble breaks out in the middle east between Israel and Lebanon. Oil almost immediately broke the old high and is currently settled at $77. I guess that's the risk of putting my neck out and making a call. I will continue to monitor the price action of crude prices to determine if it is wise to be long again in oil.
But one thing worth noticing is that the price of Crude stocks in service and exploration are still mostly over 10% off their May 10th peak. What this tells investors is that Buyers do not believe that the current crude prices are sustainable long enough for oil companies to benefit. In other words, the current spike in crude prices is temporary with a large war premium built in.
Further, the liquidity problem today has dampened speculation capital. Another reason worth noting for the continuous decline in equity prices.
Apple computers has been a favorite short of mine recently. The volume and price action of this stock is not bad for trading. I've been shorting it on and off since it was about $60. It closed at $50.67 this Friday. The problems of Apple are many and beyond the scope of this entry but I'd thought I'd mention what I've been doing in the markets recently.
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