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Thursday, July 2, 2009

Trade - PBR

Re-entered PBR... the theory goes, sell on the way up, buy on the way down.

I will post a chart later in the day. (No time due to the work load of my normal job, can only give a heads up)

Entered at low 39, will double up if mid 37 is seen.

Also, waiting on other trades to develop.


  1. In your posting of June 1, you gave several reasons that oil should consolidate back to the low 60's; but since that time you seem to have discarded that idea and returned to a positive outlook on oil. What's changed? And though you feel the market doesn't go higher without oil also doing so, aren't higher oil prices essentially a tax and further burden on the all-important US consumer?

  2. Fundamentally I still believe this. But since june 1st, oil consolidated there for a bit then spiked passed 72. At the time (short-term trading) I was wrong, althought the june 1st call may now be shown as correct in the next few weeks. (broken clock is correct twice a day kind of thing ;) But seriously... the chartist in me can not ignore the spike, it changes the trading dynamic. (especially when I see leading economic indicators holding their own like the baltic dry index)

    At the moment oil is oversold, from its previous move (first time the CCI has seen red since April, and sitting at its 38SMA. (as indicated above in the new post and where i believe PBR can be with an oil break down... have not lost sight of that possibility despite re-entering in PBR)

    Also, a re-entry to an initial position in PBR does not make me bullish on oil. I simply like PBR in the 30s with oil above 60.

    Make no mistake, if oil was to spike next week to 72 or so, causing PBR to go to 42-45 again. I would sell it and wait. But if it breaks down, I will be buying PBR as indicated above.