Subj : Market Action
To   : All
From : Paul Rogers
Date : Wed May 11 2005 07:02 pm

Content-type: text/plain

In an effort to assuage the oil-pit's free-running angst more typical of
talk-radio, the Int'l Energy Agency released a statement that not only
were supplies now sufficient, but best projections for the coming winter
showed supplies would also be sufficient albeit with little to spare.

The Street wasn't buying it.  Market prices were down until after the
2PM close of oil trading, down over a buck, after which they recovered
some.  That was enough for my formula to reverse itself and pop a Buy
signal.  I'm not buying that!  My simple formula is only based on price
action, and is an exercise to show that these sorts of signals are
sometimes modestly useful, but ultimately can't do what we want them
to--predict the future direction of the market.  Volume sank, to close
-11% below average.  So there was little enthusiasm in the market.  The
chart shows "top below tops" (1225, 1191, 1179) and "bottoms below
bottoms" (1165, 1138), which is Bearish.

I went to the market today and bought some frozen peas and some wine.
But I wasn't speculating on the future price of the commodities, I
brought them home with me.  Maybe we should change futures contracts so
they're only sold once--the buyer is forced to take delivery.  That
might run these speculators out of that market and leave it to the
businesses who are legitimate suppliers and users of the commodities.

Spare me the talk-radio dogma about free markets.  The theory is that
when prices get irrational others will have incentive to enter the
market and rationalize things.  That simplistic theory only works when
the real commodity is widely available to many traders.  Oil isn't.

No, I don't want to hear the talk-radio excuses why those crazy
Californian NIMBY's and the government are impeding the working of a
real free market.  Why are there no refineries at all in Oregon?  The
good citizens of Hermiston are equally concerned what goes on in their
back yard.  When talk-radio gets outrageous it gets better ratings,
meaning more profits for the half-dozen mega-companies that control
broadcasting.

Not only is exploration hugely expensive, hugely time-consuming, and
hugely risky, refineries are "one off", designed and built in place,
hugely expensive, hugely time-consuming, and not without their own
risks.  Oil is not a free market, never has been, and can't be.  Oil
sources are limited, consumption is "inelastic".

Where is the incentive for the integrated oil companies to increase
production when they have a product that the consumer MUST buy, no
matter what they charge?  It's prime for market abuse.  I'm thinking of
adding an energy fund to my retirement choices to get on the right side
of the trend.

 Price    Vola-    Momen-   Volume   Oscil-   Summ.
 Change   tility   tum               lator    Index
 -__+     -__+     -__+     -__+     -__+     -__+

 ___>     __<_     __|_     __>_     ___>     __>_     05/04
 _>__     __<_     __|_     _>__     ___>     __>_     05/05
 __>_     _<__     __|_     _|__     ___>     __>_     05/09
 _|__     _<__     _|__     _|__     __|_     __>_     05/10
 __|_     _<__     __|_     _<__     __|_     __>_     05/11

Timing Signals:  I don't use or recommend timing signals, but they're
fun to watch.  If I did though, well, I might use something like this.
(Be warned!!  It tends to whipsaw around signal points!)

Last Signal: BUY        Date:  05/11/05 S&P:    1171
Winner or Loser:  tbd                   By:     tbd

See my market tracking charts for '03-'04 and my investment strategy
study at my website(s):
http://www.xprt.net/~pgrogers/Pers.html
http://www.geocities.com/paulgrogers/Pers.html



Paul Rogers, paulgrogers@yahoo.com                       -o)
http://www.angelfire.com/or/paulrogers                   /\\
Rogers' Second Law: Everything you do communicates.     _\_V

.... Day-o...Day-ay-ay-o, Daylight come and me want go home.
___ MultiMail/MS-DOS v0.35

---
 * Origin: The Bare Bones BBS (1:105/360)

.