One of my favorite childhood memories was watching Monday Night Football back in the days when Frank Gifford, Howard Cossell and Don Meredith were the commentators. Hearing Howard and Don exchanging verbal jabs was a weekly treat. Seeing how this show came on a school night, my parents would not let me stay up past half time. Unless of course, our local team happened to be featured that evening. When a team was losing badly going into the fourth quarter, Don Meredith used to sing the words of an old country song, "Turn out the lights...the party is over". Crude bears may be tempted to begin singing this song to their bull counterparts after the release of Friday's US Jobs data. Bulls ought not to listen.
Sure the Jobs report on Friday was dismal. Not a big surprise. Companies in the United States want to see demand for goods pick up before they will hire new employees. In the meantime, companies are finding more ways to automate labor intensive processes. Not a pretty picture for recent college grads or those still trying to find work from the Great Recession. However, the increase in productivity enables companies to quickly meet demand for goods as this demand slowly but surely increases.
Crude bulls are well aware we are approaching the meat of hurricane season. Traders are also taking note on the rapid rise in wheat prices pulling other commodities higher. The euro too is lending support to energy futures.
So, while $100 crude will need to wait, barring some type of catastrophic event, $80 crude may be a good entry point to ride the trading range back to $85.
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