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278 comments on DrumBeat: November 5, 2007

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PeakTO on November 5, 2007 - 10:56am Permalink | Subthread | Parent | Comments top

Yes...this is a tad odd.

Oil is down as well today...expected at least a small movement up, given that no one truly knows the impact yet...ie. uncertainity.

But, nope...down 1.90 at the moment.

Does this mean they are going to be doubly surprized by this wednesday's weekly petroleum report?

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speek on November 5, 2007 - 12:07pm Permalink | Subthread | Parent | Comments top

The last two weeks have followed a pattern of oil dropping prior to the Wednesday report (oil dropped Tuesday the previous two weeks) - as much as $3-4, and then roaring back to higher highs following the "surprising" Wednesday report.

I don't get why it's a surprise, however. Robert has essentially told us flat out that the refineries will draw their inventories as much as possible in order to wait out these high prices, so why would anyone be surprised when we see another 3-5 mb draw this Wed? But, I am predicting oil will close above $100 on Wed due to this sort of dynamic.

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PeakTO on November 5, 2007 - 1:48pm Permalink | Subthread | Parent | Comments top

Agree...this wednesday looks good to break that barrier.

Especially with $5 swings.

We will see.

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Ammond on November 5, 2007 - 1:20pm Permalink | Subthread | Parent | Comments top

This is profit taking time. In a few days prices will be up again.

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Moe_Gamble on November 5, 2007 - 3:40pm Permalink | Subthread | Parent | Comments top

Traders are focused on the dollar at the moment, not the inventory report. In trading terms, Wednesday's inventory report is far far far away. Bloomberg headlines quoted Mishkin of the Fed saying that the recent rate cut could be reversed if it turns out that it wasn't needed (this is b.s., but he's fighting to slow down the decline of the dollar). Plus, the dollar's recent descent was very rapid, and some amount of a rally has been widely expected. We saw the dollar come back a little bit today: http://quotes.ino.com/chart/?s=NYBOT_DX

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speek on November 5, 2007 - 3:46pm Permalink | Subthread | Parent | Comments top

Tell me if I'm out to lunch here, but having watched oil at >$90 the past two weeks and fall on Tuesday ahead of the inventory report, it seems like there's some fear and uncertainty that arrives just before the report comes out that maybe it will show a decent build, and thus people get out of their oil positions on Tuesday. Any truth in that, do you think?

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Moe_Gamble on November 5, 2007 - 4:34pm Permalink | Subthread | Parent | Comments top

You are not out to lunch. There is also a lot of poker in very short-term moves when there isn't a lot of volume. At record prices (for example in August when crude was approaching $78, or now), longs are always jumpy, and there is always some analyst providing a headline for them to get even jumpier about. When there isn't much volume, it doesn't take much buying or selling to move the price a couple of bucks. You sell enough to trigger selling, and you buy back cheap Wednesday morning for the inventory report. Or vice versa, depending on conditions.

But this kind of stuff doesn't really matter for very long. The longer a price is manipulated or based on bad information, the bigger the breakout once fundamentals are in charge again.

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278 comments on DrumBeat: November 5, 2007

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