Keeping An Eye On The Oil Price

I have passed on some substantial price moves in oil since the global economic recovery /
expansion began in 2009, but have made very good money trading it anyway. I did not go for
the "bomb Iran" hype story, but the oil price has returned to a more normal seasonal pattern with
a mean price dip here in May. From a seasonal perspective oil tends to make a low over the
latter June - latter July period before experiencing another seasonal rise into the early autumn
to coincide with the wind up of the driving season in the northern hemisphere and the building of
heating oil stocks.

The price decline in May has been a humdinger. The Iran story has cooled, supplies are up and
global economic output momentum has cooled. Oil is moderately oversold now, but with price
descent with the kind of sharp trajectory in evidence, it is sometimes wise to stand back and
let the indicators suggest when a turn could be at hand. WTIC crude Presently, I do not care for
the free fall in MACD for oil.

As luck would have it, I outlined my view that oil could fall into a range of $85 - 90 bl. by mid -
2012 back on Mar. 29 when the price was up around $105. The downsweep in the price has
come faster and a few weeks sooner than I expected, but I am adding oil back onto my trading
list as a potential long.