Two Ways to Play: $200 Oil?
Turn a perfect storm into a windfall.
Oil at $200?
According to Reuters, OPEC President Chakib Khelil said even with current adequate supply levels, $200 oil could be a possibility because the market is driven by the dollar's slide. Khelil said, in terms of fundamentals, oil prices shouldn't be at this level because the supply in oil is sufficient with easing demand while stocks are high. Prices are high due to the recession in the U.S. which has affected several countries and devalued the dollar. "Every time the dollar falls one percent, the price of the barrel rises by $4, and of course vice versa." On the flip side, Khelil also added if the dollar strengthened by 10%, oil prices could fall by 40%. Revisit Professor Adam Michael's Trends Affecting Oil Price.
From the Bull Pen: Oil bulls content to ride the upside can use the oil ETF (USO); sell-stops can be set near $90.
From the Bear Cave: A sustained high oil price makes a painful environment for refiners like Valero (VLO); buy-stops can be set above $55.
Verizon Earnings Jump
Verizon (VZ) reported solid numbers this morning. The second-largest phone company in the U.S. said earnings came in at $0.61 per share inline with consensus estimates; revenues rose 5.5% on a year-over-year basis to $23.83 bln also inline with consensus. According to Briefing.com, among the notable performances in the company's segments, Verizon saw a net addition of 263,000 new FIOS TV customers and added 266,000 new broadband connections. In its retail wireless segment, VZ also reported net additions of 1.5 mln customers. Minyanville's Kevin Wassong mentioned Verizon in And They're Off! Yahoo's Dark Horse Race.
From the Bull Pen: Those bullish Verizon can place sell-stops below or in the range of $35-36.
From the Bear Cave: Bears can look elsewhere such as the potential double-top in Qualcomm (QCOM). Buy-stops can be set above $44.
For more ideas, check out Minyanville's Spotlight Stocks.
Quick Check Around the World
It's a misty Monday on the Street as foreign markets are skewed towards the upside.
Asian trading closed with the Hang Seng +0.59%, Nikkei +0.22%, Sensex -0.64%, Taiwan +1.47% and Shanghai -2.33%.
A glance towards Europe finds the CAC +0.97%, DAX +0.77%, FTSE +0.38%
As of 8:40 AM EST, S&P futures are higher +4.5 points to 1401, and Nasdaq futures are up +6.50 points to 1927.
A Look At Commodities
In commodities, crude oil is up +0.79 to 119.31. Gold is higher +0.40 to 887.20. Silver is up +0.045 to 16.890, and copper is up +6.45 to 395.95.
The dollar index is lower -0.135 to 72.649.
No events on the radar today. Click here to see the full events for the week.
Happy Monday! Good luck!
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