Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Oil Eyes Near-Impossible Heights


Potential for super spike in crude.

"There Will be Blood" was one of the deepest movies of 2007 and one of the most insightful, too. Daniel Day Lewis captured the soul of a driven person. I finally saw the movie on DVD a couple of weeks ago and last week I caught "The Man in the Grey Flannel Suit" which was also about the perils of single-minded drive to reach the top. Obviously movie-making has come a long way since 1956 where the person driven to achievement delivered his line about him and his kind making it possible for the 9 to 5 crowd to exist. The character Lewis played had an identical level of contempt for those that just wanted to waltz through life. Of course being a miner and wildcatter who crawled (literally) to the top, the guy in "Blood" was especially indignant.

And now my bitter hands
shake beneath the clouds
of what was everything?
Oh, the pictures have all been washed in black, Tattooed everything...

-Pearl Jam (Black)

I know (all) people make the world go round but I agree that it takes those willing to sacrifice their personal time and other passions that make it possible for the masses to chill out and go bowling on Friday night. Still, it will be those very masses that turn the tables and reenact the final scene of "Blood" and attack oil companies with a vengeance if Goldman Sachs is correct and crude is on the verge of a so-called super spike. Just imagine a move to $200 in crude can now be logically argued. According to a report from Goldman such a scenario is possible during the next six months to two years that sees crude spurting to $150-$200 a barrel. Of course that couldn't happen if the world wasn't doing well financially, yet the amount of animosity would be so great that there would be blood.


While all eyes are on a possible super spike in crude oil prices, equities are bubbling up like they're ready to gush significantly higher. For all the speed bumps that lay out in front of the market, stocks have momentum. There's a wind in the sails of the market. I continue to fret (just a tad) about volume - it's the only thing that gives me pause - and I would love to see some 2 billion share days. I also would like to see greater participation but that's a function of thin volume that is always seeking out opportunity. This would suggest a lot of long term money is still parked on the sidelines. This makes sense in part because long term money doesn't have to sweat all the gyrations of the stock market. The great news is these investors aren't interested in picking the bottom and once they've committed, they're in and I have to believe they're ready to put money to work.

One of the positive signs to the market in addition to its obvious resolve is that key sectors are participating including transportation stocks. Despite the surge to record highs in crude, transportation stocks have made a magnificent move, mostly under the radar. That Dow Jones Transportation Average is approaching a double top and that is great news for the broad market. By the way, for you beginning chartists, take a look at the perfect double bottom the index put in back in January.

52-Week Dow Jones Transportation Chart

Click to enlarge
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos