i think we are retesting lows now. Noticeable difference this time is that Oil is holding steady relatively speaking. OIL bottom is so very close now as you want to be out in front of a move up. So what would make oil move up?
Hedges expire: producers will not want to continue to produce oil if the selling price is cheaper than the cost to produce.
Restructuring balance sheets and or bankruptcies ) today there was rumors that CHK did just that , yet oil did not tank )
Consolidation whereby companies with deeper pockets pick up smaller players with nice exposure to high output fields like the bakken etc. They cut admin cost and acquire proven fields without all the exploration cost and rig sets
I think this is the reason we are seeing oil hold steady. If right we could even see a move up near term say oil back to 40
i expect a couple of more oil reports to show gluts but I would think by the time we get out 5-8 weeks we will see supply constricting just a bit.
This was 3% higher than my cl of Dow 14700 plus or minus 250 . The area represented support found around spring of 2014 or more specifically Feb march 2014
This is significant because Oil made a reversal the next day or so. after hitting 29 dollar a barrel.
without going into all the details why, I think it is possible that two things happen now, the oil itself trades range bound for a while and not necessarily move higher but also not move much lower.Drill rigs way down and production actually shutting off at some sites will have a rebalancing effect on supply sufficient enough, imo, to cause even them most bearish bear to at least think twice before going short again.
The mkt outside of oil and oil related stocks is then best assessed on other mkt drivers and that would be demand. In that vein, i see a possibility to start buying some cheaply valued stocks with primary exposure to US economy and not China.
With respect to China, i will only say one thing and that is that although growth has slowed- it is still fairly healthy .So i am not as bearish as I was but also not extremely bullish.
We may retest the lows of last week but i am reticent to think we break through them. If so I would be a buyer of certain stocks as i am right now.