Response To A Question

In response to a question yesterday from a reader {and not a client} on whether oil companies should be bought based on the chart I posted on energy just below.

1st. I cannot answer that question for that person.  I don't know his investment structure and his own individual risk/reward criteria.  If he wants that answer he needs to do his own research, talk to his own investment advisor or hire me.  After I understand him a bit then I could give him some advice on energy based on his own needs.  

We do not do recommendations on this blog.  I will point out sometimes interesting patterns.  I will let you know if based on what I am seeing about said subject if I am a buyer or seller in a pertinent period of time around that chart if it is relevant.  Meaning if yesterday I was buying energy when I posted that chart I would have let you know what I was doing. I will also disclose whether I am invested in said category for clients and for my personal accounts.  I will also say that these positions can change at any time.  I will not say for example in a post like we put out yesterday you should buy or sell energy.  Our only goal when writing is to try to educate into our investment thought process for clients and friends of the firm.  

2nd.  In regards to energy, what I tried to express yesterday is that the pattern in oil is interesting now to watch.  I think more than anything we need to see how oil reacts to that downward sloping trendline I talked about yesterday.  Right now money flows don't give us any indication on what probability suggests could occur.  For all I know oil could hit that trendline, even violate it slightly, then continue lower, or it could violate that trendline and power higher, or violating that trendline could just be indicative of the beginning of a bottoming process for oil.  The point is we have to wait and see.

Markets are acting better this AM.  Whether this is a bounce off a low and the beginnings of stabilization or another dead cat bounce that will ultimately lead to a resumption of the down trend is again something that we'll have to wait and see.

*Long ETFs related to energy in both client and personal accounts although positions can change at any time.