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Brewmaster
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AG

Quote:

Farmer @ Johnsongrass, TX

Farmer @ Johnsongrass, TX said:

ProgN said:

Biden's Raid on the Permian Basin - Carbon Neutral Coalition

I guess gas prices aren't high enough yet.






Quote:

UPDATE - 7/2/22 - See bolded above

Quote:

LONDON, July 1 (Reuters) - OPEC in June did not deliver on an oil output increase pledged under a deal with allies, a Reuters survey on Friday showed, as involuntary declines in Libya and Nigeria offset supply increases by Saudi Arabia and other large producers.

Quote:

<laugh/cry emoticon>

Fossil fuel demand destruction is not materializing faster than supply reductions. $10 per gallon gasoline on the horizon. Heck, JP Morgan stating on 7/1 that $380 crude (their outside range number - worst case) is possible.
https://www.bloomberg.com/news/articles/2022-07-01/jpmorgan-sees-stratospheric-380-oil-on-worst-case-russian-cut

$200 crude, should be bullish bicycles.

Ay, caramba!

so WTI is a bargain down here as well then? this is insanity. If many weren't working from home some already, many will be with $10 gas.

SF2004
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AG
Futes got a bounce on potato head saying he may reduce tariffs on China and also news of commodity prices weakening.

Brewmaster
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Red Pear DFW Luke said:

BaylorSpineGuy said:

I mostly get draft kings ads and sometimes Rebecca Creek whiskey (no Rebecca's Creek is not a vague porn reference).

Sounds like me and tumble weed are cut from the same cloth haha.


You're thinking of Rebecca's Cheeks.
you had me at cheeks! never too early for a rally girl



Farmer @ Johnsongrass, TX
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Yes.

If you get a chance to watch that video I posted above, it's worth the 30 minutes.

Working from home.....Did you see the Facebook/Meta Zuckerberg announcement? More layoffs. Someone will be working from home.

"The dire economic warning was delivered during an internal videoconference meeting on Thursday for Meta's META, -0.76% 77,800 workers, according to a New York Times report. To underscore the ominous message, Zuckerberg told employees that they should expect to do more with fewer resources and that their performance would be more aggressively graded."

"I think some of you might decide that this place isn't for you, and that self-selection is OK with me," Zuckerberg said on a call, according to the Times. "Realistically, there are probably a bunch of people at the company who shouldn't be here."

https://www.marketwatch.com/story/mark-zuckerberg-issues-dire-economic-warning-to-meta-employees-11656781950?mod=home-page

Those 2 paragraphs above from the linked article....I lost track how many times that type of messaging hit me during my career.

I borrowed this statement below from the web, but it's accurate.
"US has 1 Million daily barrels less of of refining capacity compared to pre-pandemic levels. There is another 650,000 bbl facility that is potentially closing at the end of this year. Fuel prices are going to remain elevated until the supply and demand balances out. This will only occur when consumption of fuel declines to a point when refineries have excess capacity."

Structurally, the world doesn't have a producing crude or refinery supply to satisfy all current demand. Gasoline, diesel, propane, nat gas all need to move higher in price. (If Powell had a clue, he would sit back and let energy prices do the work for him. He doesn't need to raise rates. I addressed this more in a post a few weeks back. If Powell continues to raise rates, Powell will crush the economy as energy has a long upward ways to go pricewise before demand reaction kicks in.) 59 South just filled up in London on Friday at US$8.66 per gallon.

That drawdown from the SPR that FJB is allowing is nothing but putting this country at a National Security Risk for political talking points. SPR is under 500 million barrels now. It's 225 million barrels below the ATH. It took 4 years to fill 225 million barrels into the SPR. SPR is suppose to represent 90 days of critical inventory from what I read. FJB drawdown from the SPR is supposed to stop at the end of Oct to beginning of Nov. Once that draw down from the SPR stops, what's to keep a lid on any price. FJB doesn't understand that the amount he discharges from the SPR will coincide with a reduction from OPEC+. Crude will remain high price (>$100) until a Conservative (Republican likely) is elected in 2024. Lot of money to be made between now and then.

It will be interesting to see if Blackrock will manipulate to keep XOM down as a favor to FJB. I believe the XOM short is 40 million about 1 to 2%, pretty standard. I believe this situation is volatile enough to keep the Blackrock's honest. We'll see. Maybe Soro's and Blackrock team up and they both go down on a short squeeze. LOL!

ETA: WTI currently trading at $110.98 +$2.55 - 8:47pm CDT

ETA2: Big PU's and SUV's will be cheap pretty soon.
SW AG80
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AG
I did watch the video you posted. Thanks. It is VERY informative.
I cheated in my post above about the cost of deep water production. I texted an Aggie friend whose last several years was head of deep water exploration and production for a major
He is high on Pioneer for several reasons. One of which is their large presence in the Permian. Also, I'm guessing, because BR has not invaded their board is another reason.
So I'm buying PXD sometime this week. And your video made me up my ante.
ProgN
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BREwmaster said:

Red Pear DFW Luke said:

BaylorSpineGuy said:

I mostly get draft kings ads and sometimes Rebecca Creek whiskey (no Rebecca's Creek is not a vague porn reference).

Sounds like me and tumble weed are cut from the same cloth haha.


You're thinking of Rebecca's Cheeks.
you had me at cheeks! never too early for a rally girl




You thieving ******* without citation. That's cool, we all know who you got them.
Brian Earl Spilner
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AG
Reversal right after the open?
BaylorSpineGuy
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May retest 3800 but not sure it holds. Reversed on 3858 overnight in the futures pretty close to Model T retracement. Suspect next leg down continues.
sts7049
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AG
austinAG90
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Inflation Versus Recession...Market Fears...Volatile Moves...Euro Parity?

We have seen some wild moves in very illiquid markets as the shortened week starts in the US... The dominate narrative is the battle between inflation and recession... Last week recession raised its ugly head as the US consumer and Pmi showed a slowing economy... The latest Bloomberg number is 38% chance of recession... But if you believe the revised Atlanta Fed number of -2.1 %, we are technically in a recession... Futures have reversed some of the later Fed hikes and now look for a peak in February 2023 with a rate reduction by May of 2023... For July the odds still predict a 75 basis point move, but only 50 in September...we still think 50 for July, but that will depend on numbers and increased recession fears..

Overnight we were all over the place in both stocks bonds and the curve... After having one of the worst starts to the year we have seen in our trading career, which spans many decades... S+P worst first six months since 1970... Dow Jones worst since 1962, Nasdaq and Russell 2000 worst ever, and Bloomberg Ag for Fixed income, worst since 1975.. All predating us, and we thought we had seen it all...

Equities started lower on Monday morning in quiet trading but headed higher as rumors , later confirmed, that Yellen held talks with Vice Chair Liu of China concerning tariff reductions.. Then the S+P dropped like a rock in two trades, going from 3850 at 2.45 am to a low of 3800, where it held... It is still near that bottom, currently at 3907....

Bonds had another wild ride.. Over the last two weeks we have seen 2 years go from 3.44 to 2.75 on Friday... 10 years from 3.49 to 2.78... Overnight 2 years and 10 years were inverted for a short period of time in wild trading... Both traded over 10 basis point ranges... 2 years from 2.84 to 2.96 and 10 years from 2.88 to 2.98... Both are now at 2.91, but won't be there for long... As for rates ranges this week, 10 years have 2.71 on their radar... 2 years 2.78... Both resistance levels... There are other numbers in between, but those are the big boy numbers... As for support, we see about 3% for both...we expect economic numbers to continue to show deterioration...

Speaking with a friend of the family who is very active in the consumer space, running multiple companies... He told us yesterday that their own internal data shows the consumer stopped spending 90 days ago due to inflation... Not necessarily recession fears... Just plain stopped... That has been consistent with the consumption data we saw last week and the big drop in the Atlanta Fed GDP numbers... We expect the numbers this week to continue that trend

Numbers... PMI tomorrow could be another surprise to the downside and Jolts numbers have to be coming down... Facebook announced last week that they are reducing their hiring of engineers by over 30% and starting culling their staff for layoffs... They are one of many... Jolts should reflect this,,, Nonfarm employment expectations for Friday has BEEN REDUCED BY 30%... 390 TO 273... We think lower...

Currencies... The markets are starting to cut back what they expect the ECB to do in September... That has caused the Euro to slump to a 1.02 handle to the dollar... Parity is less than 3% away... And while we have always viewed the ECB as being weak, they again will have missed an opportunity to get to neutral... While the Fed is not much better and has missed multiple opportunities, we still expect them to raise into the early recession talk... Soft landing becomes harder daily...


New issue market is dead for now or at least on life support... 15 billion is expected this week, but it is getting harder to garner interest... Banks have backed away from underwriting private equity deals for now... Junk market is not much better...Junk issuance this year is only 60 billion, less than 25% of what it was at this time last year, 250 billion..slowest start since 2009... IG and HY are wider this morning but not by much... We still see another 10% wider move coming before issuance resumes.

THE OUTLOOK... The dollar is strong, the Euro weak... The Fed will still raise in July, either 50 or 75... And more than likely again in September... While we may be in a technical recession now, we still do not see a recession of substance on the horizon....the key things to watch in the near term are the JOLTS, FOMC MINUTES, ISM, AND UNEMPLOYMENT... All this week... THE BIGGER NUMBER TO WATCH IS NEXT WEEKS CPI NUMBERS.... And then of course the Fed meeting on July 26/27....It is a battle between inflation fears versus recession outlook...

Our view... Equities may or may not have capitulated... Not sure on that... For those that are looking at the Vix to pop 40, options are no longer the best way to hedge a portfolio, so do not expect the Vix to give you direction... We think the Fed will continue to raise rates even as recession fears increase... They will be put in a box if CPI reverses as we think... It all depends on whether you believe the weekend report from JP on oil

(BN) JPMorgan Sees 'Stratospheric' $380 Oil on Worst-Case Russian Cut

or on the Citi report this morning

(BN) Citi Warns Oil May Collapse to $65 by the Year-End on Recession

For now we expect the Fed to stay the course and for rates to back up until something breaks... But we are not there yet... So 2.71 is a reasonable objective... As for equities and all the malarkey that earnings expectations are too high, yes they are, but equities have reversed a lot so far this year, so do not be surprised if 3500 holds again....
ProgN
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The following is a quote from Caleb's father in premium from an update. It's a great example of our Aggie Network and the people that make it up. The market sucks, but this puts things in a more important perspective.

Quote:

All that being said, the highlight of his week was a special package that was mailed to Caleb from Aggieland. Caleb (and his dad) were beyond excited to open the package to find an Aggie football jersey from the Gator Bowl that read, "To Caleb: Gig 'em. Jimbo Fisher". Also included was an autographed football from Jimbo. Smiles galore! It was a very bright spot in a rough week. We were so grateful.

Besides Aggie football, Caleb is also passionate about anything space related. He's been the recipient of NASA gifts from real-life astronauts and also a personalized video from an astronaut that said he'd be praying for Caleb while aboard the international space station. Caleb was blown away (and I was in tears).

The days are long here at the hospital, but goodness, these and all of the other ways we've been supported help keep Caleb, our girls and us encouraged. Thanks for loving us during this difficult season.



I'm proud to be an Ag, Gig'em!
insulator_king
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AG
Very thought provoking article on LNG.

https://finance.yahoo.com/news/natural-gas-soars-700-becoming-040106114.html

May be a permanent change in the old days of cheap NG for heating fuel.
BaylorSpineGuy
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We could get a big drop today. JPM is only 20 cents from its 5 pt gap on the chart. Expecting a big drop today if it doesn't hold here. With 2-5 yield curve inversion, banks look weak and recession is near.
J.P. 03
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AG
Already testing Mancini's 3755 level. Let's see if it holds.
Bob Knights Paper Hands
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I didn't go in short TSLA this morning early, and that may have been a mistake, but I'd like to see QQQ lose 277 before I get in too deep.
texagbeliever
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J.P. 03 said:

Already testing Mancini's 3755 level. Let's see if it holds.
Looks like it is more like 3750. Might get another retest of that here shortly.
Spoony Love
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June 17 SPY low of 362.17 could be in play this week. We have nothing on schedule indicating good news or good news coming and that low is well within a downward channel I've been watching. Yes that may sound extreme, but we are continually heading downward.
BaylorSpineGuy
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Looks like we just retested last week's low. Need to see if this holds. Markets are weak. Suspect going down further.
Premium
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AG
BaylorSpineGuy said:

Looks like we just retested last week's low. Need to see if this holds. Markets are weak. Suspect going down further.


At a 30,000' level, I don't see a huge reason to see an increase.

Interest rates up and increasing
Supply chain issues
War in Ukraine gas disruptions in Europe
Gas prices were already high, but now very high
So now all goods and services are high
Labor shortages make things even more expensive

By this measure, surprising the whole thing isn't down another 30%
Charismatic Megafauna
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AG
Charismatic Megafauna said:

Charismatic Megafauna said:

I think I'm going to buy Crwd 202.5 calls 2 weeks out. Possibly spreads for earnings eom

7/15 195/210 for 2.12

Dammit, took the easy 25% on these this morning. Ripping now
texagbeliever
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Was talking with a guy who works for resin wholesaler. He mentioned how they had trouble getting Resin to be able to meet orders a few months ago but now they are running out of space in their warehouse waiting for those same consumers to order more resin. I think supply chain issues might be fixed by lack of new demand, but warehouse space could become the bigger issue. This was something TGT already has hinted at.
Charismatic Megafauna
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Charismatic Megafauna said:

Bought some vale 14.5 for next week too

Added some weekly 14 calls this morning. So juicy down here
BaylorSpineGuy
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Contrarian view here: inverted H&S forming on SPY with neckline at 375.
cptthunder
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BaylorSpineGuy said:

Contrarian view here: inverted H&S forming on SPY with neckline at 375.
I seent it too but someone said not today sir
LMCane
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BaylorSpineGuy said:

We could get a big drop today. JPM is only 20 cents from its 5 pt gap on the chart. Expecting a big drop today if it doesn't hold here. With 2-5 yield curve inversion, banks look weak and recession is near.
earlier this morning I was watching bond yields:

2 year: 2.804

10 year: 2.805

third times a charm for inversion of yield curve?
Brewmaster
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AG
ProgN said:

BREwmaster said:

Red Pear DFW Luke said:

BaylorSpineGuy said:

I mostly get draft kings ads and sometimes Rebecca Creek whiskey (no Rebecca's Creek is not a vague porn reference).

Sounds like me and tumble weed are cut from the same cloth haha.


You're thinking of Rebecca's Cheeks.
you had me at cheeks! never too early for a rally girl




You thieving ******* without citation. That's cool, we all know who you got them.
Yes, shamelessly stolen from you, and right click, save, LOL.
ProgN
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They are gorgeous!
Bob Knights Paper Hands
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It's been interesting to me to watch the relatively tight range today on SPX vs the ranges on QQQ and TSLA, AMZN, NVDA, etc.
Bob Knights Paper Hands
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I scalped some TSLA calls earlier that would have made my weekly goal had I held them. That's all I've done trading wise today. I might go in NVDA calls or TSLA puts in a bit, depending on which way we go.
Bob Knights Paper Hands
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Just scalped TSLA 670P. I bought after it closed a 2nd 5-min candle off the top of the upper BB and below Friday's close. I sold after it tested below the 10-sma of those 5-min intervals.
Premium
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AG
Wow oil down 10% under $100. What's going on? Demand that bad?
Lake08
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I bought some calls earlier. That's why it's down
Brian Earl Spilner
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AG
VIX gonna go below $28?
ProgN
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Premium said:

Wow oil down 10% under $100. What's going on? Demand that bad?
Inverted yield curve signaling a recession, thus lower demand.
BaylorSpineGuy
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Yeah, this has been my argument. When the oil companies lost their 50 day MA's, I became more bearish on that front.
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