CL and RB are both off about 12% since our Oct 25 short call.
CL is coming up on the top of its rising white channel – a potential turning point. It’s probably close enough to be shorted here at 85.23.
I’ve been skeptical of oil’s rally for quite some time, observing almost a year ago [see: Don’t Ignore Inflation] that the YoY price rise would drive inflation well above the Fed’s target range.
Frankly, I’m surprised that it took investors this long to get nervous nervous. IMO, the Fed’s “transitory” story was cockeyed from the start.
As we approach an important inflection point — our 73.50 target — the question shifts to where oil/gas prices need to go in order to put the inflation monster back under the bed.
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