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Crude Oil: Drilling For Opportunity
On July 11, a perfect fundamental bullish storm SHOULD HAVE sent crude prices to the moon. Instead...
July 11, 2008 was the unofficial D-Day for the Crude Oil market. “D” -- as in, DOWN. From that most recent peak, oil prices have plummeted more than $20, to a two-month low -- a severe sell-off that has also included the steepest drop in dollar terms since the Gulf War (circa 1991).
However, the most shocking incident of July 11, 2008 was not its launch of crude’s latest slide. It’s the fact that on that particular date, a perfect bullish fundamental storm blew in over the oil market that should have -- by all mainstream logic -- sent the energy market soaring to the moon.
Off the top are these memorable July 11, 2008 events:
- The Dow Jones Industrial Average plunged below the psychologically important 11,000-level for the first time in two years.
- The U.S. Dollar skated south to a three-month low before hitting bottom on July 15.
- Gold prices (Oil’s alleged ‘safe-haven’ partner) rocketed above $940-, $960-, and $980 per ounce before turning down on July 15.
- And, two powerful blows pummeled the U.S. economy -- i.e., the largest regulated thrift to fail in US history (see: IndyMac Bancorp) and the downgrades of Fannie Mae and Freddie Mac.
Not to mention escalating tensions with Iran AND the onset of the 2008 Hurricane Season with tropical storm Bertha. YET -- instead of rocketing into outer space, crude oil has fallen back to earth.
Mark Your Calendar: In the Friday, July 25 Daily Futures Junctures “Weekly Wrap Up” segment, Elliott Wave International’s senior commodity analyst Jeffrey Kennedy will reveal how low OIL is set to Go in the days ahead. Click here to learn more.
Elliott wave analysts know that NO single outside factor will change the internal course of a financial market’s major trend. And, on the very day of Crude Oil’s recent slide, the July 11 Daily Futures Junctures “Weekly Wrap Up” segment went on high alert to the market’s downside potential via the following price chart. (Some Elliott wave labels have been removed for this publication)
The action since then speaks for itself.
The best part is, in the Friday July 25 Daily Futures Junctures “Weekly Wrap Up,” Jeffrey Kennedy revisits the crude oil market to show where and when the latest downtrend may end. In the meantime, check out Jeffrey’s in-depth analysis and FIVE labeled price charts on Orange Juice in the July 24 Daily Futures Junctures. Click here for details on how to begin.
Editor’s Note: For intensive, intraday and daily, forecasts of Crude Oil and other energy markets, try EWI's Energy Specialty Service.