Oil bubble to burst this week (real estate, buy, make money, investing)

[travelmate38]

Downward spiral is under way. You heard it here first. Oil will begin a downward trend back into the mid 130s, from there, speculators will begin to panic dropping it into the low 120s, then a gradual decline to the 110-115 range where it will stay for months. Regular unleaded will still be at $4.15-$4.25 for a few months before falling in to the $3.25-$3.50 range where it will stay.

How do I know this? Just got off the phone with a big wig in the oil biz. This is his prediction and he broke it down piece by piece for me. Too much pressure on the downside now.

[bchris02]

Ill believe it when I see it. Every time a downward spiral begins, something happens to send the price back up. That would be great if it would happen though.

[tambre]

Originally Posted by travelmate38

Downward spiral is under way. You heard it here first. Oil will begin a downward trend back into the mid 130s, from there, speculators will begin to panic dropping it into the low 120s, then a gradual decline to the 110-115 range where it will stay for months. Regular unleaded will still be at $4.15-$4.25 for a few months before falling in to the $3.25-$3.50 range where it will stay.

How do I know this? Just got off the phone with a big wig in the oil biz. This is his prediction and he broke it down piece by piece for me. Too much pressure on the downside now.

This would be fantastic. It's kind of ironic though, thinking that $3.25-$3.50 for gas is a bargain.

[Philosophizer]

Originally Posted by travelmate38

Downward spiral is under way. You heard it here first. Oil will begin a downward trend back into the mid 130s, from there, speculators will begin to panic dropping it into the low 120s, then a gradual decline to the 110-115 range where it will stay for months. Regular unleaded will still be at $4.15-$4.25 for a few months before falling in to the $3.25-$3.50 range where it will stay.

How do I know this? Just got off the phone with a big wig in the oil biz. This is his prediction and he broke it down piece by piece for me. Too much pressure on the downside now.

I agree with this, but if we get a major hurricane in the gulf or a strike on Iran, you can throw this right out of the window. I think the market has gotten too far ahead of itself on it's push to $140. That being said, we're still in a commodities bull market, and with no prospects of a rate hike anytime soon, we'll see $200 crude long before we ever drop below $100. In two years time, crude at $140 a barrell is gunna be a steal.

[Philosophizer]

On that note, I'm going to turn this trend into some money. If you think oil will settle back to $120, buy refiners whose margins have been getting crushed due to high oil prices. Valero is trading around $38 a share right now from it's peak of $78 in July of last year. I'd recommend holding the stock until it hits $48 or oil goes below $125. Remember bulls and bears make money on the street, but pigs get slaughtered. Take profits people. This is nothing more than a trade. Keep an eye on the gulf though and be ever cautious of middle eastern conflicts.

[AJGIANTS]

Originally Posted by travelmate38

Downward spiral is under way. You heard it here first. Oil will begin a downward trend back into the mid 130s, from there, speculators will begin to panic dropping it into the low 120s, then a gradual decline to the 110-115 range where it will stay for months. Regular unleaded will still be at $4.15-$4.25 for a few months before falling in to the $3.25-$3.50 range where it will stay.

How do I know this? Just got off the phone with a big wig in the oil biz. This is his prediction and he broke it down piece by piece for me. Too much pressure on the downside now.

thats not really bursting the bubble. Oil will have to go far below $100 for the bubble to be burst. What you are mentioning is a correction.

Let me know if these examples make sense:
Real Estate and Technology are examples of a bursting bubble.
The Dow Jones went through a correction after 2001.

Whatever it is I hope it happens. My wallet has become very thin after driving all weekend.

[bchris02]

Originally Posted by AJGIANTS

thats not really bursting the bubble. Oil will have to go far below $100 for the bubble to be burst. What you are mentioning is a correction.

Let me know if these examples make sense:
Real Estate and Technology are examples of a bursting bubble.
The Dow Jones went through a correction after 2001.

Whatever it is I hope it happens. My wallet has become very thin after driving all weekend.

Bursting the bubble or a correction all is tied to the value of the dollar. As long as the dollar remains weak, oil prices will remain high. Oil fell below $140/bbl this morning as the dollar rose, but then some bearish news was released on the dollar that caused it to rapidly fall, and oil gave up much of that loss. As time goes on, its appearing that a stronger dollar is the ONLY way to convince speculators to sell. They are investing in oil as a hedge against inflation.

And yes, $100 oil is a correction, $60 oil would be a bursting.

[cpg35223]

I think you have to get past hurricane and Summer driving season first, but I concur.

[lchoro]

Crude oil would still be in the same long-term uptrend. One year out, the high end of that uptrend would forecast oil to reach $170-180.


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[gardener34]

Any little thing that happens anywhere sends things into a whirl - so and so gets a nosebleed in Saudi arabia... panic! I would say it you cannot predict what it will do.