Taking Stock: Retest?

Was that it? Was that the supposed retest of the November lows that everyone has been talking about? I was anticipating it going lower than it did today. Maybe the market will drop tomorrow. I'll see what Dan Fitzpatrick says in his video tonight.

There was a certain beauty in the price movement of the precious metals stocks that I have. The movement was almost textbook, with it dropping back just enough to touch the 50DMA, both on Pan American Silver (PAAS) and Yamana Gold (AUY). Maybe now they will go through the 200DMA this time, and things will continue to work out the way I had so devilishly planned.

NovaGold (NG) and the infamous Crystallex (KRY) are not included in that price pattern. I think Crystallex will ultimately go higher, along with NovaGold.

Out of curiosity, I looked at the time frame in which it took oil prices to climb from ~$50bbl to the previous high of ~$140bbl. The timeframe that I found turned out to be 1.5 years, and only about 6 mos. to fall back to around $50bbl. I have been reading that the inventories of oil have been increasing, supposedly due to the lack of demand. There was also an article on Reuters saying that the price of gasoline has been being held up artificially due to refiners producing alternative products that are more profitable. Traders have also been buying oil and oil futures while the price is down, in hopes of selling it at a higher price later (that's the idea, right?).

My interest in the price of oil is due to my positions in Transocean (RIG) and Ultra Petroleum (UPL). Natural Gas prices virtually track the price of crude oil. Transocean tracks the price of oil, so I suppose what I am saying is that Transocean and Ultra Petroleum trade almost in sync with each other. I have been keeping an eye on the charts and watching the 50DMA progress to flattening out.

Jim Crammer was talking about Transocean in a video on his website, saying that it is "too dangerous to own right now". I used to attentively watch him, but now I just use him for ideas. If you want to buy Transocean (RIG), just make sure you get it near support. Stephen Leeb has been right about many things (much more than Cramer), so I figure that he will ultimately be right about there being price shocks in oil. As he has mentioned in his Market Updates, major oil projects have been being cancelled, which will cause a shortage in oil one demand picks up again. On that note, I am confident in saying that China is back in the swing of things.

I have also noticed that Boeing and Airbus are supposedly going to ramp-up production of their new jets this year. I'll believe that when I see it in the headlines.

I'm still sticking with my sector rotation strategy.