Greetings All!

Today’s Post is a long one…so go get a drink and your reading glasses!

Let’s see how my fair-weather Wife, Crude Oil, progressed in our market analysis overnight through Tuesday’s Close.

We bring up our Hourly View again, and it is clear if your were of the Bearish sentiment…you were correct.

 Bias remains to the downside here, and our lower Support level of 49.90 is still deeply in sight.

(Now, keep in mind these Charts represent the December Crude Futures Contract…so your Charts may vary by a few fractions of a Cent, or Ticks. Interestingly enough, this Contract expires tomorrow…which gives us more ammunition to the downside…)

(click once for captures)

Our overall “sentiment” really has not changed “technically” in the last day.

We still have a wide berth for a corrective retracement here…but I will say this: 49.90/50.00 will most likely be reached before we see this corrective directionality.

Oil is down 60% since its’ $145 peak in July, and is certainly poised to continue falling. All we need to hit our $49/$50 levels are continued Dollar strength, and another collapse in the Dow. The Yen Crosses such as EUR/JPY and GBP/JPY will also follow, providing additional confirmation.

This will certainly bring the mid-$40’s in sight.

Now…let’s get to all the large Macro Socio Economic Neo Political Geographical and Historical Criteria of Crude Oil, and see where we land!

( OK…try saying all of THAT 10 times as fast as you can…)  

I know…I can hear all of you saying in unison…

“But CVJ!…We have a brilliant idea!  LET’S NOT!”

Fine with me!

I will attempt to sculpt all of this down into a singular view of “Why is that crazy CVJ Bullish on Oil?”

While in the medium-term, I do believe Crude and Commodities as a whole are still due for depreciating value…I do not see this lasting forever. After all, what are Commodities? They are largely things we humans need and consume.

Crude Oil is the “Consumer King” of them all!

Now…while we continue to work on all sorts of alternative energy resources and such, I personally do not see these solutions as viable in the near-term…even when they come to fruition and are practical and adopted on a global scale.

These macro-factors will take 40-50 years to really clear the “consciousness” of the World to adopt, and perhaps a generation longer.

I use one Example here for my Bullish argument.

The TATA Automobile Company.

“The WHAT, CVJ?”

 Tata. This is India’s largest vehicle manufacturer, but you should know it for another reason:

It bought Jaguar and Land Rover from Ford for $2.4 billion earlier this year!

What…never heard of this? The American Media kept this on the QT?…under the table?…beneath the sheets?

I’m shocked, I say…SHOCKED!  

The Tata “Nano” is the new Indian flagship “sub-compact compact” car that is geared towards 45 million Indian citizenry and their Motor-Scooting ways. Not to mention the other 230 million “middle class” folks who may find the automobile attractive for their needs.

The Nano is a cute little thing… it makes that new “Smart Car” look like that stretch Limo-Hummer you took to the Opera last week.

If I ever get to India to visit a couple of my Trading Mentors and fellow-Bloggers, Sunil Mangwani and Dr. Sivaraman, we will have to drive around in one!

The Key?  The $2500 price tag!….well within reach of tens of millions of Indian, Asian, African, and other populations looking to ditch the Rickshaws and Bicycles!

So, to me, this singular event will translate itself into a surge in Petrol demand, as well as Crude and all of its’ other Distillates in manufacturing and transporting all these little “Matchbox” Cars all over these economies.

That is my argument for being Bullish on Crude Oil in the macro-long term. Simple and concise.

While we look for the alternatives and move ahead with our lives…we have to remember those in the “emerging” world economies are moving ahead as well.

Prime Example: Just because the Olympics are over in Beijing…does not mean China has closed up shop and went back to the fields!

 DISCLAIMER!

Please do not go all “Earth Day” on me here.

Please do not send me an Anthrax postcard or something…or…Heaven forbid… even worse…

A “4X Made Easy” Course! …hee hee…   :-)

Please be mindful here…that these are just some thoughts on my part based on common sense and the logistics of Supply and Demand over a really long-term Cycle!

I have no idea what Crude will do in the next 3 minutes…much less the next three years.

Again, as a Trader, I do not NEED to know. I simply have to have movement and Price action to REACT from.

My friends and personal Mentors hold the same view. When you have an “arsenal” of resources to work within the Markets properly…it becomes a matter of trying your best to choose the right resource for the task at hand.

Are we always on target?…always correct?

Of course not!

But the Key is having your Risk Management criteria in place at all times, as this will cushion the damage of choosing the wrong resource and ill-advised opportunity you presented to yourself.

So bring on the Questions and Comments as always!

Tomorrow?… The Nemesis Returns!

My shiny ex-girlfriend, Gold, will come by for an Interview.