May 23, 2008
Even despite a mid-day sell-off in oil, the markets couldn’t manage to make any kind of rally ahead of the Memorial Day Weekend. Volume was light in the NASDAQ, while average in the S&P. Oil still managed to advance, which has put a lot of fear into the hearts of traders and investors alike. For those of you long, today’s action was not quite what you were hoping to see. The indices are about as oversold as they come, and we should see some bargain hunters in the mix, to start off next week. With the rise in oil, even Congress is looking to find ways to stop the forward march, with one idea on the table being to limit the speculator’s ability to profit from the commodities.
We tend to believe, at least in the near term, that we are closer to a top in oil than a bottom, but from a long-term perspective, we know that we better get our act together from a refinery stand point, and start tapping into places like Alaska, that is just loaded with oil reserves in the American National Wildlife Refuge (ANWR). Heading into next week, we will see more of what we saw this week, if oil continues to climb the charts. Wall Street’s focus is clearly on oil and nothing else – especially since the credit crisis and earnings season seem to be a thing of the past (at least in their minds).
Enjoy your long weekend. The market is off on Monday and will resume on Tuesday. Don’t forget to thank a veteran for their great service to this great nation – God Bless the USA.
Here’s the NASDAQ and S&P Charts…