It’s been two months since oil and gas reached our downside targets [see: Throwing the Game.] Since then, WTI (CL) has bounced 36.4% and RBOB has bounced 30.6%. CL has plowed through several upside targets since then, finally reaching our 57.48 target last Wednesday. As we’ve discussed, it’s not just the chart patterns that suggested a reversal. It’s also the economics of higher oil and gas prices which, as Trump reminded OPEC this morning, threaten the low-inflation narrative which makes a dovish Fed stance possible.
We’ll take a look at whether this top is likely to hold and what the implications might be for inflation and interest rates.
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