Red-Hot Resources

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Monday, May 12, 2008

Monday Charts -- the Dollar, Oil, Treasuries and Gold

We took some profits in Red-Hot Commodity ETFs on Friday. Was that a smart move? We'll find out. I think oil has shot up so far, so fast, it should go back and test at least its $120 support level before heading higher again. Below that, there is strong support around $110 and $100.

I sent Mike Larson this bond-oil chart this morning and asked him why T-notes and oil are moving higher together. He replied: "The inflation vigilantes are on vacation."

It sure seems like gold is leading oil lower. Could gold retest 850 and maybe even 800 before heading higher again?

If oil prices do consolidate, the S&P 500 could benefit.

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