the dow and s&p have broken out of their trading range that they have been in since early aug.
technical targets are 12,600 and 1340 respectively----looks pretty aggressive and europe could take the air out of these sails in a hurry. so no guarantees.
On Friday one of our members in New York sent me the Citigroup Global Markets forecast for oil prices. Below are the bullet points from their report. - Dan
The picture on the crude chart (Nymex) continues to look extremely bullish and it may now be close to the next break higher.
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A potential double bottom neckline stands at $90.52 and a close above here would suggest acceleration higher to at least $105.
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Ultimately we suspect it will go even higher still.
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The set up on Brent is similar and suggest a danger of a move to new highs for the year around $134.
The decisive hold (Twice) of the 76.4% retracement level around $76 has set up a double bottom formation that would be confirmed by a close above the neckline at $90.52.
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In addition it has broken out of the downward sloping channel in place since May
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The minimum target on a completion of this double bottom would be for a move to $105.
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Overall we think even higher levels could be on the cards but….one step at a time.
Brent has not yet broken the channel top at $114.68 with the double bottom neckline at $116.60
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A break through these levels would suggest a move to at least $134 which would be a new 2011 high.
If both the above moves take place then the present Spread between the two may actually widen further in the near term.
Rising Oil prices with the spread to the benchmark (Brent) widening is not a great economic mix.
They go on to say that the Brent premium to WTI will grow to $29/bbl then retrace to $17/bbl (with WTI moving higher as Brent levels off.)
NEW YORK (AP) -- Oil prices jumped more than 4 percent Monday, reaching the highest level in more than two months, on signs of economic growth in the U.S. and Asia.
After bracing for a possible recession in the U.S. and Europe, analysts say investors have changed course. They're now trading with the expectation that Western economies will keep growing this year -- albeit slowly. As the economy strengthens, demand for oil rises to run factories and fill drivers' gas tanks.
"The market was being held back by fear" of a recession, PFGBest analyst Phil Flynn said. "We haven't seen stellar economic numbers so far, (but) they haven't been recessionary."
Benchmark crude rose $3.87, or 4.4 percent, to finish at $91.27 per barrel in New York. Prices haven't been above $91 per barrel since August 5. Brent crude rose $1.89 to end at $111.45 a barrel in London. WTI continued to move higher in after hours trading.
Prices rose after news of a string of acquisitions and a better profit forecast from Caterpillar sparked a rally on Wall Street. The Dow jones industrial average and the S&P 500 were up about 1 percent. The Nasdaq was up more than 2 percent.
HSBC said that China's manufacturing sector continues to expand. The bank's measure of industrial production showed Chinese manufacturing activity increased from last month. Energy demand tends to rise as factories crank into a higher gear. Analysts took the report as a sign that China, the second biggest oil consumer behind the U.S., will continue to drive increases in world oil demand this year.
Japan said exports rose 2.4 percent last month, as its economy recovers from the devastating earthquake and tsunami in March.
Meanwhile European financial leaders planned to boost the eurozone's bailout fund to help keep banks in Italy and Spain from being engulfed in the region's debt crisis. The European Financial Stability Fund is designed to insure banks against potential losses and to keep money flowing through the economy.
