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Tuesday, August 30, 2022

Market Update 8/30/22 CNBC Fast Money Traders Like Energy

I didn't anticipate Oil would rally higher, but yesterday it was up another 4%, and energy even made a new recent high, and this on a down day, when most analysts are supposedly afraid of a Fed caused recession? So, why is energy really up? Because as I pointed out weeks ago, it's a continued sector rotation, in a continuously rigged market. 

I lost power, after some storms rolled through Chicago, yesterday, so first thing I wanted to do this morning, is to draw up a new Oil chart, and see what's going on with Oil from a technical perspective.   

Oil's Monday Morning surprise looks like this on the chart 

$WTIC - 1. Back-tests the 50 day moving average, for the first time, in over 2 months. 2. Trades to the top of a bearish parallel channel. 


I'm really surprised that anyone would be bullish energy, as Oil continues to make lower lows, followed by lower highs, ever since Oil topped out in March of last year, yet it remains a very popular trade, why?

CNBC Fast Money Traders Like Energy 

Second thing I did this morning was to try to track down some of the energy names, Fast Money was pumping yesterday. I only caught part of the show, but I missed most of it.  

When I searched the internet for more information, what I found is what you now have to pay for something called "CNBC Pro", to get more information. 

Of course, whatever is popular is going to get pumped on CNBC's Fast Money, and that's going to draw in more paying members.  

Here's something I found from back in June 

View the first few minutes of  the embedded video, and you'll quickly realize that this so called, "technician", doesn't know the difference between a base, and a breakout pattern. He's seen pointing to a base on a 10 year chart, that doesn't even exist. It's absurd 

I could be wrong, bit I have to believe that this guy is sent out to sell a story, but doesn't actually have any technical expertise. Point to a valid chart pattern! 

$XLE - Energy Select Spider (ETF) Remains very overbought near the top of an upturned channel. 

I've applied the most bullish EW count, I could come up with, to the chart below, and that looks like a Primary wave IV, and that's a difficult thing to predict. If correct, the Pattern could take months to even reveal itself. Of course energy could still go a little higher, but I'd be looking for it to give back all the gains of the past 2 months, shortly. I've already identified this as a minor wave b, head-fake rally, on several other energy charts. To make it simple, We saw a crash in energy, and now we're seeing consolidation.  

I think CNBC traders don't have a clue, where Energy is going, except when they drive Oil back to the 50 day moving average, on a Monday morning, and they seem to me more interested in selling memberships, to the dumbest retail investors on the planet, rather than provide any useful information. 

Last week, it was the idea that Warren Buffett could buy $OXY, that was used to drive Energy higher. I'll bet, that story was manufactured in order to drive the energy market higher, on light summer volume.    

Warren Buffett Can Buy 50% Of OXY Stock, But Is It A Buy Or A Sell Right Now?

As far as the broader market is concerned, I'm not sure we're seeing a tradeable rally, and in the short term, I'd like to see the $SPX (and SPY) test the 50 day moving average.


Take Care, AA 

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