Monday, January 8, 2007

Crude & Xerox

Wow... Venezuela and the Saudi's are both saying OPEC needs to do address production, but to no avail... crude back below $56. There's certainly no law that says crude can't break that long term support in the $55 area and head straight for $50.

Weakness in crude, it would appear, is starting to become a problem for the gold bugs again. While a further slide in crude might be viewed as a positive and inflation friendly for the broader stock market, if crude were to really cave through 2 yr support, it would certainly wallop the entire energy sector and likely end up being too much of a good thing for the stock market in the near term.

Seperately, notes that Xerox (XRX) has been bid on up "unconfirmed" takeover speculation. Options volume very heavy in both the January and February calls.

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