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Bank of America sees $50 oil as Opec dies

Bank of America said the oil price crash is worth $1 trillion of stimulus for the global economy, equal to a $730bn “tax cut” in 2015. Yet the effects are complex, with winners and losers. The benefits diminish the further it falls. Academic studies suggest that oil crashes can ultimately turn negative if they trigger systemic financial crises in commodity states.
 
MrJohnRoss said:
Bank of America sees $50 oil as Opec dies

Bank of America said the oil price crash is worth $1 trillion of stimulus for the global economy, equal to a $730bn “tax cut” in 2015. Yet the effects are complex, with winners and losers. The benefits diminish the further it falls. Academic studies suggest that oil crashes can ultimately turn negative if they trigger systemic financial crises in commodity states.
Click to expand...

Agreed, hence the problems for the Middle Eastern welfare states, Russia, South America, the list goes on. I'm not sure where the tipping point is, but I'm fairly certain we're close to it. Here in Texas, the Shale industry is a huge part of our economy, so goes Texas, so goes the nation...
 
My Son is in the Oil Industry (Chemical Injection).
He tells me one pay period he's getting 100 hours the next he's getting 50.

Personally I think there is a bit more room to the downside. (10-15 percent)
 
MrJohnRoss said:
Picked up some more TZA at the open. Likely support for the S&P is in the range of 2020 - 1978. Let's call it 2000 for easy memory. The 50 DMA is also at 1996. That's also a level of support. I'd expect a bounce in that range.
Click to expand...

A 38% Fibonacci retracement would take the S&P500 down to the 1980 area. That sure was a big red candle today. *gulp* :blink:
 
With 2/3 of my 401k in cash, the rest in TZA and metals/miners, I made 42 basis points today. (TZA was up 6.3%.) Not a big deal, but it sure beats holding stocks. Most of my previous stock holdings were down anywhere from 2-5% today.

That being said, I'm expecting an oversold bounce tomorrow. Beware of catching falling knives, unless you're a damn good day-trader.
 
MrJohnRoss said:
Quite a turn around for the markets today. Glad I sold off most of my stocks last week and holding some TZA as insurance.

Here's how the MOSI looks for different sectors:

XLY - SELL
XLY - SELL
XLP - SELL
XLF - BUY
XLV - BUY
XLI - SELL
XLB - SELL
$NDX - SELL
$COMPQ - SELL
$OEX - SELL
$SPX - SELL
$SML - SELL
XLK - SELL
XLU - SELL
$WLSH - SELL

Some of these signals are right on the borderline, but it's pretty obvious that there isn't much strength left in very many sectors. Proceed with caution of you plan to stay in the markets.
Click to expand...

Financials finally broke the bubble, and flipped to a sell signal. That means all MOSI indicies I track are currently in sell mode.
 
MrJohnRoss said:
With 2/3 of my 401k in cash, the rest in TZA and metals/miners, I made 42 basis points today. (TZA was up 6.3%.) Not a big deal, but it sure beats holding stocks. Most of my previous stock holdings were down anywhere from 2-5% today.

That being said, I'm expecting an oversold bounce tomorrow. Beware of catching falling knives, unless you're a damn good day-trader.
Click to expand...

Right on cue....
 
The last seven trading days for TZA can be summarized as follows...

Down
Up
Down
Up
Down
Up
Down

There's some wild swings going on with this market.
 
13.81

It remains to be seen if I'll close out in the green... or the red. Friday and Monday will be interesting days. Something to look forward to. :blink:
 
Well, the massive storm that was supposed to hit California is upon us. So far, we've had a bit of wind and moderate rain, but I think the MSM has blown it way out of proportion. I even stayed home from work today, because of possible power outages, and I feared the streets would be flooded on the way home. Psssh. :suspicious:
 
MrJohnRoss said:
Bank of America sees $50 oil as Opec dies

Bank of America said the oil price crash is worth $1 trillion of stimulus for the global economy, equal to a $730bn “tax cut” in 2015. Yet the effects are complex, with winners and losers. The benefits diminish the further it falls. Academic studies suggest that oil crashes can ultimately turn negative if they trigger systemic financial crises in commodity states.
Click to expand...

JTH said:
Agreed, hence the problems for the Middle Eastern welfare states, Russia, South America, the list goes on. I'm not sure where the tipping point is, but I'm fairly certain we're close to it. Here in Texas, the Shale industry is a huge part of our economy, so goes Texas, so goes the nation...
Click to expand...

[h=1]Russia Is Fighting Its Financial Problems By Selling The Gold They've Been Hoarding (RSX, GLD)[/h]
 
And if they have been buying gold for several years and are now selling....they must be really taking a bath buying High and selling Low! :nuts:
 
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