New Year, Oil-D Habit
The following was first published on Elliottwave.com on 1/4/06
Three days into a brand new year AND old habits are dying hard: Britney Spears is out partying, Nicole Richie is back in rehab, and Mr. Main Stream financial media is feeding its craving for fundamentals.
Take, for example, the highly addictive notion that a slip in crude oil prices brings about a surge in stock values.
This, dear friends, is your brain. And THIS slew of headlines from the morning of January 3 is your brain on such a drug:
In the words of EWT: "There is no consistent correlation between stock and oil prices. That's the market's job: to throw a snowball in the air to catch your attention so that when you look up, it can smack you in the jaw with another one."
Now, before you enter a world of anger, bargaining, and depression -- consider what else the July 25 Theorist had to say about where the oil market would be by the end of the year:
This is what those in the business of recovery call "A Breakthrough" Moment, many more of which are in store for readers of the December 2006 Elliott Wave Financial Forecast.
The following was first published on Elliottwave.com on 1/4/06
Three days into a brand new year AND old habits are dying hard: Britney Spears is out partying, Nicole Richie is back in rehab, and Mr. Main Stream financial media is feeding its craving for fundamentals.
Take, for example, the highly addictive notion that a slip in crude oil prices brings about a surge in stock values.
This, dear friends, is your brain. And THIS slew of headlines from the morning of January 3 is your brain on such a drug:
- "US stocks inaugurated 2007 with a triple-digit rally after a drop in oil prices [and other sundry] sparked optimism about the economy." (AP)
- "Oil plunged below $59 per barrel for the first time since November. You could have another excellent year for stocks in 2007 to the extent that oil stabilizes, it definitely will help on the consumer side." (Bloomberg)
- "US Stocks point higher on oil's decline." (Reuters)
What state are these from?
The state of Denial.
That said, we are left with only one possible course of action: Intervention via this groundbreaking chart of the 52-week Correlation between the S&P 500 and crude oil prices from 1996 to 2006, as presented in the July 25, 2006 Elliott Wave Theorist.
http://img518.imageshack.us/img518/4...62006smbv8.gif
http://72.14.253.104/search?q=cache:...a&ct=clnk&cd=1
http://www.zealllc.com/c2005/Zeal102105A.gif
In the words of EWT: "There is no consistent correlation between stock and oil prices. That's the market's job: to throw a snowball in the air to catch your attention so that when you look up, it can smack you in the jaw with another one."
Now, before you enter a world of anger, bargaining, and depression -- consider what else the July 25 Theorist had to say about where the oil market would be by the end of the year:
"A myriad of signs point strongly to a selling opportunity in oil. The psychological environment demands that we continue to pay attention to the original wave interpretation, which implies a top is occurring now. A setback of at least Primary degree is due."
This is what those in the business of recovery call "A Breakthrough" Moment, many more of which are in store for readers of the December 2006 Elliott Wave Financial Forecast.