Hello and welcome back to CRI's CTS Spotlight
11/26/10: The US dollar continues its' counter trend rally as growing fear over European debt problems and the very real threat of war has sent the market scrambling. Contrary to this, growth prospects for North America are looking better with every passing day. Yields are starting to move higher which has given int'l investors a reason to own American. This 'perfect storm' of pro-America/anti-international could lead to a BIG MOVE. If the bullets start flying in earnest there will may be a massive move into the US dollar as traders 'wait-it-out' in still the world's only true reserve currency. Couple this with European default fears and it makes for a not so fundamentally sound int'l market. On a brighter note, two areas that continue to look good are meat and energy. We looked at Cattle last week in CTS Spotlight and this week we shall look at some of the energies.
Energies
This is one area of the commodities market that has not been in the spotlight for some time. In fact, while the grains and metals have gone parabolic over the past few months, there has been a relatively quite stealth bull market going on in crude in particular and energy price in general (with the one exception being Natural Gas). This stealth rally seams to be well entrenched and based on sound fundamentals. Inventories have been steadily declining while the economy is slowly improving. Couple the resurgent US economy with a forecast for a much colder North American winter and it is not surprising to see that this sector has been steadily moving higher of late. Should prices move in the fashion of other commodities rallies of late, we may see energy prices move back into the center spotlight.
Ironically enough, the Fed's injection of $600 billion dollars into the economy over the coming quarter may be entirely gobbled up by rising energy costs. Not only will the rise counter act the Fed's injection but it will further enrich the Arab nations at the direct cost to US taxpayers.......you just can't write better fiction than reality.
Regular readers of CRI publication should be well aware of the Uranium bull market underway. OnlyDoubles's NewTrades subscribers have enjoyed several doubles over the past month as the junior Uranium sector has come alive on ridiculously low stock valuations coupled with increased demand news from China.
Looks like unleaded-gas prices are going back up.....ugh!
Brian Beamish FCSI
the_rational_investor@yahoo.com
http://www.the-rational-investor.com
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