Oil Squabble
Oil gapped open and is continuing higher, rallying out
of a (Cooper) 1-2-3-4 Pullback
Off Highs setup to a new contract high on the ongoing concern about tensions
in the Persian Gulf. Iraq said Kuwait is “stealing” its oil in a
dispute over oil beneath the Iraq-Kuwait border. At stake are as many as 300,000
barrels a day. Kuwait said it would allow a neutral international body to come
in to examine the accusations. Iraq flew airplanes over the border in violation
of its southern no-fly zone. US Defense Secretary Cohen said the US would
“defeat” Iraq if it attacks Kuwait.Â
Tensions in the Middle East are also running high after
an explosion in the Iraq capital Baghdad. Iraq says Iran fired missiles on
the capital city, heightening tensions. November crude
(
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PowerRating) is up .69 to 35.41. The bias is to the upside, but the 34.95 level
(in the November contract) has to hold to negate a Turtle Soup reversal setup.
(Turtle Soup setups occur in the same day, rather than the following day,
as in the Turtle Soup Plus
One setups for which we provide daily signals in the Futures Indicators
sectionÂ
T-bond futures are down sharply for a third day, as the market worries that
higher oil prices will translate into inflation. December T-bonds from the
Implosion-5 List
(
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PowerRating) are down down 1/2-point at 97 24/32.Â
December dollar index futures
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PowerRating), from the Implosion-5 List,
are rising to fresh contract highs after the European Central Bank’s recent $2.4
billion purchase of euros and sales of dollars–intervention–failed to support
the fledgling euro.
Euro FX
(
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PowerRating) futures are down .00300 to .85660 and Swiss francs
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PowerRating)
are trading lower as well.