No. of Recommendations: 21
...whether Jim might offer any insights about current market conditions....
A little more unpredictable than usual?
Not that I trust them that much, but signals I watch are not wildly bullish. Nasdaq NH-NL has been negative and generally falling for over a month now, my favourite slow moving average crossover bearish since March 19. It's now about 2.2 months since a fresh recent market high, so the clock is ticking on that front, poor returns on average at more than 3-5 months.
My current stance is to make sure I'm not owning anything that I myself conclude is too fully valued, and not be embarrassed to hold "too much" cash. Not panicking, but skipping greed for a while.
I'm happy not to buy any more of anything on dips for the time being, the main reason being that I seem to be the only one in the world with that view.
One thing is for sure: even if peace and happiness broke out tomorrow the global oil and gas market is going to be mostly broken for at least four months, and hugely disrupted until at least year end, which can't be good. I highly recommend the recent article in the Economist entitled "Even the best-case scenario for energy markets is disastrous". For example, gas production would be 4% shy of demand this year even if Qatar started pumping what it can today.
The article notes: "The implications are stark. Global crude stocks, on course to end March in the bottom third of their historical range, will also keep dwindling for weeks after Hormuz reopens. As countries with thin buffers run out, bouts of panic-buying and price spikes could ensue. Bidding wars for LNG are equally likely. The last cargoes from Qatar to leave before Hormuz closed will reach Asia and Europe in days, says Ashley Sherman of Vortexa, a ship-tracker. After that, buyers must seek supplies elsewhere or go without, jeopardising the restocking of reserves for winter"
Call options for oil and gas prices mid-to-late 2026 are very very expensive, but I suspect they're underpriced nonetheless. Personally, I think a price spike over $200 is more likely that not.
Jim
