Oil Warning Last Night..

Eureka Perspectives June 2, 2022 Uncategorized No Comments

Crude oil had a big decline overnight, but the big guys who are long pushed it back up in early trading today. I would not be surprised to the hammer come down on them now.

The regular markets, especially tbe tech related stocks are acting well, we are about to see phase two of the OMG rally.

An eye opener outside the box relationship view of the old oil economy vs the digital semi-conductor basis of the New Green economy..

Here is a chart of the XLE energy ETF divided by the SMH semi-conductor ETF going back to at least 2010. (uses monthly data) :

To me, what jumps out as how the relative value of the old oil has declined vs semi-conductor based new energy since 2011 and that the lone bump up with a strong RSI occurring just occurred in the past 5 months. My view is that the longer term slump in XLE vs SMH will start up again soon, see the half/day (3 hour chart version of the above relationship just captured at 2:00 PM CDT.

This chart shows how XLE appears about to start to decline vs SMH.

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