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 Hickey and Walters (Bespoke) submit:
For those interested, the current 53% decline in oil without a 20% rally is by far the biggest drop the commodity has seen since we have daily pricing for going back to 1986. And this decline was preceded by a 37% drop from July 3rd to September 16th (the commodity had a 20%+ rally from 9/16 to 9/22). The total drop for oil since its peak on July 3rd now stands at 61.34%. The current environment is one where many records have been broken, and oil's record fall is just one of them. 
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Hickey and Walters (Bespoke) submit:
With oil breaking below the $60 barrier this morning, we thought we'd provide price charts of the commodity since 2000 and since this April. As shown in the first chart, even after oil's 60% decline since July, it still hasn't broken below its long-term uptrend line that started back in late 2001. With the speed and forcefulness of the declines in oil over the last couple of months, however, it shouldn't be long before this uptrend is at least tested. click to enlarge Complete Story »
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Hickey and Walters (Bespoke) submit:
Even though the stock market is down 10% since the election, oil is down even more at -13.84%. Back in mid-2008, most people that called oil a "bubble" were ridiculed for not knowing the true "supply/demand" economics of the commodity. With a decline of 58% since July, the oil "bubble" callers look pretty prescient these days. click to enlarge Complete Story »
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Hickey and Walters (Bespoke) submit:
Below we highlight a Fibonacci Retracement chart of oil since the low of $16.7 that it made in late 2001. These retracement levels represent the percentage of the gains made from '01 to '08 that have been given up since oil's peak, and many technicians use them as key support levels. However, with the way Fibonacci has been working for all asset classes in recent months, we'd use this for informational purposes instead of for trading purposes. As shown, after blowing through the 38.2% and 50% retracement, oil is now about to test its 61.8% level of $66.58. This means oil has now given up 61.8% of the gains it made during its run from $16 to $147 over the last seven years. At least we can rejoice in the decline of something. Complete Story »
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Hickey and Walters (Bespoke) submit:
With oil trading at $75/barrel, the commodity is down 48% from its highs just a few months ago. Remember all those people who said oil would never get back to double digits again? That prognostication didn't last long! The irony here is that oil is down more than the stock market, but you don't hear anyone complaining about evil oil short sellers or begging for drastic supply cuts to halt the slide in prices. It all depends on the asset class when it comes to free market intervention. Complete Story »
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Hickey and Walters (Bespoke) submit:
Remember when the stock market moved in the exact opposite direction of oil a couple of months ago? As oil went up, stocks went down, as the impact of higher energy costs was supposed to weigh on the economy. That trade has now completely reversed. The chart below highlights the change in the S&P 500 and oil this past week. As shown, the two have moved in perfect tandem, and in fact, the correlation between the two on a minute-by-minute basis this week has been 0.97. That's about as high as it gets for asset classes. When markets are stable, asset classes are much less correlated. When panic sets in, correlation spikes sharply, and it turns into a diversification nightmare. Complete Story »
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Hickey and Walters (Bespoke) submit:
Oil moved below $90 for a brief period of time this morning, and below we provide a price chart of the commodity in 2008. As one point, oil was up 51% year to date, but now it is down 6.33%. After breaking below its lows from mid September, the technicals suggest further declines are still to come for oil. click to enlarge Complete Story »
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Hickey and Walters (Bespoke) submit:
The difference between the front-month and next-month contract for crude is at a whopping 12%! The front-month contract rolls over today, so a massive short squeeze seems to be taking place. As shown in the second chart below, while very uncommon, this kind of spread has happened in the past. Just another crazy data-point in a crazy market. click to enlarge Complete Story »
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Hickey and Walters (Bespoke) submit:
Crude oil was just halted on the NYMEX after trading up over 10%. Today's gain, if it holds, would be the 8th largest one-day gain going back to at least 1986. click to enlarge Complete Story »
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Hickey and Walters (Bespoke) submit:
Below we highlight our trading range charts of ten major commodities. The green shading in the charts represents between 2 standard deviations above and below the commodity's 50-day moving average. Moves above or below the green area are considered extremely overbought and oversold. After experiencing serious declines for the past two months, some commodities have bounced back nicely over the last week, while others haven't seen much of a pop. After trading more than 2 standard deviations below its 50-day, oil has staged a double-digit rally, and is on the verge of breaking its downtrend if it closes above $108 today. Natural gas, on the other hand, hasn't rallied at all, but it has stopped going down at least. Complete Story »
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Hickey and Walters (Bespoke) submit:
With our financial system in turmoil, no one is paying attention to the fact that oil is down another $5 and change. As shown in the chart below, after being up 51.38% at the start of July, the commodity is now down on the year. As oil skyrocketed, so many companies lowered guidance recently after factoring in a large increase in energy costs. With oil now back to break even for the year, corporate profits should benefit. click to enlarge Complete Story »
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Hickey and Walters (Bespoke) submit:
Below we provide our trading range charts of ten major commodities. The green shading represents two standard deviations above and below the commodity's 50-day moving average, and moves above and below indicate extreme overbought and oversold levels. It's no news that commodities have suffered major pullbacks over the last two months, and the charts below provide a good view on how bad it has been. After trading at the top of its range for what seemed like forever, oil finally traded to the bottom of its range late last week, and after touching extreme oversold territory, it finally bounced for a couple of days, only to see big declines again on Friday. Like most other commodities, natural gas unfortunately hasn't gotten a bounce. Since touching 13.58 in early July, nat gas is down 42%. Complete Story »
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Hickey and Walters (Bespoke) submit:
Below we highlight strategist price targets for oil in the fourth quarter of 2008. Goldman Sachs has been making news today with the reiteration of their $150 oil call, and as shown below, they're currently the most bullish strategist amongst participants in Bloomberg's strategist survey. Overall, 24 out of 31 have a price target greater than the current price of oil, but it's important to note that these targets were all upped right as oil was peaking. The average price target for Q4 is $121, while the median is $125. Complete Story »
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Hickey and Walters (Bespoke) submit:
Crude oil has pulled back slightly in intraday trading following the release of the Department of Energy's [DOE] weekly inventory report. In the report, crude oil inventories for the week ending August 15th rose by 9.3 million barrels, which marks the largest weekly build since March 2001. While crude showed a large build, gasoline inventories posted a large drop (-6.2 million barrels). Interestingly, while gasoline demand has been declining, supplies have been dwindling just as fast. This week's drop in stockpiles was the seventh largest since data begins in 1990, and it followed last week's 6.4 million barrel decline, which was the fifth largest. Complete Story »
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Hickey and Walters (Bespoke) submit:
Gallup.com's most recent report on President Bush's approval rating highlighted that it had been inching higher since the lows seen in late June. While still extremely low at 33%, it's 5 points higher than the 28% approval rating seen on June 19th. Below we highlight a chart of Bush's approval rating since he took office in early 2001 versus the inverse price of oil. As shown, the two track each other almost perfectly. As oil prices rose to a record high in June, Bush's approval rating hit a record low. Is it any wonder that Bush has seen a bounce with oil now $35 off its highs? 
Complete Story »
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