Dennis Elam

Contributor at Odessa American

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ELAM: Crude oil up 25%

1 week ago | oaoa.com | Dennis Elam

Brent oil futures settled Thursday at their highest value since January 22 pushed by conflict in the Middle East. — The Wall Street JournalWest Texas Intermediate traded at $60 May 19. This morning July delivery is trading at $75. The $15 jump since then has raised the price 25%. And energy and service stocks have rallied. Expanded drilling occurs when firms believe the new well will improve their bottom line. That is what a $15 increase will do. But, not so fast.
ELAM: Crude oil vaults over $70

2 weeks ago | oaoa.com | Dennis Elam

Early Friday morning, local time, Israel launched dozens of strikes against Iran and declared a state of emergency, according to Defense Minister Israel Katz. — ABC NewsCrude oil has advanced to $64.59. This is just a few cents shy of resistance at $65. Clearing $65 gives a next target of $70. — This column last FridayAs I write this Friday morning, crude oil has jumped about $5, last quote $72.67. As noted last week the chart was already in bullish formation.
ELAM: Loose lips sink ships

3 weeks ago | oaoa.com | Dennis Elam

“I think that Musk has a completely different game, [so] he will not need any political asylum, although if he did, Russia, of course, could provide it,” Novikov said, in remarks translated from Russian. — Dmitry Novikov, first deputy chairman of the State Duma Committee on International AffairsThe Russians have shown a proclivity for savage warfare in the Ukraine. But at least they enjoy poking fun at Trump’s former friend now turned adversary.
ELAM: Chaos continues

4 weeks ago | oaoa.com | Dennis Elam

Chaos follows Donald Trump wherever he goes. — Nikki Haley during 2024 Presidential campaignMarkets soared last Monday on reduced tariff talk. Wednesday the Court of International Trade ruled the President does not have the authority to impose sweeping tariffs. Thursday a Federal Appeals Court ruled Trump could continue collecting tariffs, for now. Trump vows to go to the Supreme Court.
ELAM: Stock rally fizzles

1 month ago | oaoa.com | Dennis Elam

The Treasury sells $16 billion in 20-year bonds at a high yield of 5.047%, up from 4.810% a month ago. The Brent crude oil price has fallen 13% since Trump’s Liberation Day. A trade war could trigger a global recession further depressing the oil price. — Wall Street Journal WednesdayRichard Russell, author of the Dow Theory Newsletter, observed that the bond market is more sophisticated than the stock market. Yesterday (Wednesday) the Treasury sold $16 billion dollars of 20-year bonds.
ELAM: Optimism abounds

1 month ago | oaoa.com | Dennis Elam

The Roaring 20s stock market provided derivative support to real estate and automobiles. The Auburn Cord Duesenberg company would finally close its doors during the following Depression. Duesenberg became part of the lexicon with the phrase, she’s a duesy. It meant the object or project was really something special. The same thing is happening now. There are now four stand-alone Ferrari dealerships in Texas.
ELAM: The recovery may be ending

1 month ago | oaoa.com | Dennis Elam

The S&P is still down almost 8% from its February high. The S&P is down about 5% in gold terms from Liberation Day, and buys 18% less gold than it did at its February high. — Streetwise Wall Street Journal FridayThe Dow Industrials fell from the February high of 45,000 to the April 7 low around 37,000. The recovery rally has retraced about 61% of the total fall. This is a typical Fibonacci counter trend rally. Indeed the overall market is down 8% from the February high.
ELAM: Worries mount in the Basin

1 month ago | oaoa.com | Dennis Elam

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ELAM: Relief rally ending

2 months ago | oaoa.com | Dennis Elam

Bear market rallies are short, sharp, and ferocious. That reflects uncertainty though for now mood has flipped from fear to optimistic. — Steve Sosnick, Chief Strategist Interactive BrokersWe noted last week that hope, fear, and greed moves markets. I added complacency to the list. By April 7, the Dow had dipped to 36,500 from February’s high of 45,000 (rounded). By mid-month the rally took the Dow to just shy of 41,000. Another sell-off occurred and today resistance seems to be at 40,000.
ELAM: A week of chaos

2 months ago | oaoa.com | Dennis Elam

If oil prices fall further into the $50 range, you have the potential to bring U.S. production down. — Andy Hendricks, Economist at Patterson UTIMay crude touched $55 this week recovering to around $60 today (Friday). The percent of energy stocks in a bullish pattern fell from 70% to zero to 4% today. Momentum indicators have yet to bottom. Apache (APA) has been cut in half since last summer now trading at $14.19. Every energy stock in my extensive list is trading down today.