Hitting the Panic Button

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World leaders announced the coordinated release of strategic petroleum reserves today in an effort to force oil and gas prices lower amidst rapidly rising inflation. The US, India, China, Japan, Republic of Korea and the UK are among the countries participating.

WTI’s initial reaction hasn’t exactly gone according to plan. Traders, who have seen these attempts fail before, are underwhelmed by the numbers. When attempted in June 2011, WTI fell $5/barrel on the day of the announcement but rallied $11 over the next month [see: Not Terribly Slick.]

It took a severe correction in late July to make a meaningful difference. Even then, it didn’t last.This time, we didn’t even get the initial dip as there is a very good chance that OPEC+ will simply offset the paltry release by adjusting their own production.

The real solution will need to come, as it always does, from political pressure. Last time I checked, the US is still the principle supplier of military arms to the Saudis. Perhaps if the US were to threaten an arms embargo…

Oh, look, here’s one now.

continued for members…RB is also rallying.The equity picture still looks vulnerable, though CL has had little to do with it.

VIX has broken out and, for now at least, remains broken above the white channel top and the SMA200.USDJPY is threatening another breakout…

…while EURUSD pauses in the midst of its slide.

And, yields are seeing another bounce – which will likely die on the vine like all the others since late October.The biggest damage being done this morning is in gold and silver, which is off sharply after losing support. GC is hanging onto its SMA200, but it remains to be seen whether it will hold. The trend line bottom is at 1775.50 today.BTC still looks likely to tag its cloud bottom and SMA100 at 53615.Last, COMP is getting clobbered today. I’m still keen on the idea of a SMA200 at this point (now that it would be a higher low.)