Did Oil Just Fool Everyone?

The breakdown is broken… [Morning Reckoning] April 04, 2023 [WEBSITE]( | [UNSUBSCRIBE]( Did Oil Just Fool Everyone? - The most important market event right now is happening in oil… - Crude had a crazy year… - Now, oil is exploding! [Patent #11,219,620: The Most Valuable Patent In History?]( I believe this could over time become the single most valuable patent in history. [That’s because this patent is just some of the exciting work being done by a company which is developing treatments for one of the biggest and most common diseases in America…]( A disease which impacts 54 million people, or about 26% of the adult population in America. Whatever you do, do not let this opportunity pass you by. [Click here now for the details.]( [LEARN MORE]( Baltimore, Maryland April 04, 2023 [Greg Guenthner] GREG GUENTHNER Good Morning Reader, A handful of key assets are on the verge of major moves this week. Gold is on the cusp of a significant breakout above $2,000 as the US Dollar index drops. Any significant extension above the mythical $2K mark should attract a ton of attention from the mainstream financial media, lighting the fuse for an even bigger momentum move in the metal and the miners. Bitcoin is also working on its own potential extension above $28K. It’s marked time for more than two weeks after a breakout move off the March lows. Bitcoin is now tightly coiled and could easily top $30K once its next run is underway. The artificial intelligence bubble is also getting frothy once again. Tech stocks are back as market leaders following a brief hiatus – and the sector’s AI darlings are ripping higher out of choppy consolidation patterns that have trapped these speculative names since February. No, it’s probably not time to run around screaming about a new bull market. But we’re seeing some structural improvement in the market. The strong stocks are trending. And most breakouts are following through – instead of abruptly reversing like we experienced last year. These are all exciting developments for stock market bulls. The first quarter ended with a bang, giving market participants a break from the relentless selling that dogged the market in 2022. Despite overwhelmingly bearish sentiment, ongoing inflation and rate hike fears, and a full-blown bank crisis, this year’s strongest names continue to defy the odds. But the most important market event kicking off the second quarter isn’t happening in the tech sector. It has nothing to do with Bitcoin or crypto. It’s not even about gold’s historic march toward all-time highs. The most impactful market move right now is actually happening in the oil patch. And it could have huge implications for energy stocks as we kick off the second quarter. Crude’s Crazy Year If you made money trading stocks last year, chances are you booked some of those gains in the energy sector. The Energy Select Sector SPDR (XLE) posted a dominant performance during the first half of 2022 as bear market conditions took hold. While growth stocks swooned, XLE gained nearly 70% before topping out in early June when crude spiked to $120 during the early months of the Russia-Ukraine war. With nowhere else to turn for gains, XLE became one of the most crowded trades on the market. XLE endured a hard reset, dropping 25% from its June highs before bouncing and recovering into the third quarter. But crude prices couldn’t catch a bid. After topping out in the summer, light crude dropped more than 40% on a steady decline that saw it approach $70 by the end of the year. While the energy sector still managed to finish at the top of the heap in 2022, it was coming under increasing pressure in March. Crude was losing crucial support levels, falling below $70 for the first time since late 2021. And this time, it was taking energy stocks down with it. As tech snapback trades gained traction in Q1, oil patch plays were flirting with lower prices. Crude was approaching $65. XLE has dropped nearly 20% in just six weeks and was well below its 200-day moving average. By mid-March, a bigger breakdown was looking inevitable. But the cartel had something to say about that… [New Biden Bucks Follow-Up Available Now]( Hey, it’s Jim Rickards. Since posting my original Biden Bucks presentation online, millions of people have viewed it. Snopes and the Associated Press have even attempted to “fact check” me and claim my warnings are false: [Click here to learn more]( Point being, my message has raised a storm and caused a lot of controversy. But in the time between my message and now, a lot of new developments have come to light. That’s why I’ve just released an update to my original prediction… one which will likely be even more controversial. [>> Click here now to access my new 2023 Biden Bucks follow-up](. [LEARN MORE]( All of a Sudden, Oil Explodes In case you missed it, OPEC jolted the oil market over the weekend when it announced a surprise million-barrel cut. Saudi Arabia alone is cutting 500,000. I guess they weren’t too happy with prices steadily decreasing over the past ten months… Geopolitical implications aside, this news was the jolt oil needed to stave off a major breakdown. When the futures market opened Sunday evening, crude immediately jumped more than 6% to retake $80. Light crude is now up an incredible 25% from its March lows. More importantly, the breakdown is broken. [chart] XLE is now back above its 200-day moving average and the key $82 pivot. The stage is now set for a quick move back to $90 and a challenge of those 2022 highs. Despite its leadership role last year, XLE’s chart has been a mess for months. Last month’s breakdown looked like the real deal – and I suspect many pro and amateurs alike were leaning bearish on oil and energy stocks. That’s a recipe for a big move higher. Oil fooled everyone into thinking it was about to fall off a cliff. Now, the energy sector is poised to attack its highs. I think it’s safe to say that more than a few traders will be caught with their pants down if this move extends higher in the weeks ahead. Let me know your thoughts on this topic (or any other topics you want covered) by emailing me [here](mailto:feedback@dailyreckoning.com). Best, [Greg Guenthner] Greg Guenthner Contributing Editor, Morning Reckoning feedback@dailyreckoning.com [Crypto Legend Reveals: “The Next Bitcoin”]( He called Bitcoin at $61. Now he says this next crypto will be even bigger. In fact, he’s targeting 25X gains over the next year alone. [>>Click here now for the details]( [LEARN MORE]( In Case You Missed It… Sean Ring, Editor Artificial Intelligence: The Dark Side… or the Light? [Sean Ring] SEAN RING Dear Reader, In 1968, HAL 9000 did for computers what Jaws would do for sharks seven years later… …Scare the living daylights out of everyone. I wasn’t yet born in ‘68, so I was lucky enough to miss the whole “HAL” thing. But for people who watched 2001: A Space Odyssey, the fear felt justified. Fear of what? We’ll get to that in a bit. Even though I was barely a year old in 1975 when Jaws came out, I remember being terrified of sharks throughout my childhood. It’s a rational fear if you grow up in South Africa (70-80 shark attacks per year) or Australia (about 24 yearly attacks). But in stinky New Jersey? Since 1884, there have been 50 attacks on the Jersey Shore… in total. Steven Spielberg succeeded in frightening moviegoers, to varying degrees, over nothing. But was Stanley Kubrick, the director of 2001, as, shall we say, irresponsible? After all, Kubrick’s prior movie, Dr. Strangelove or: How I Learned to Stop Worrying and Love the Bomb, is a masterpiece that Roger Ebert called “arguably the best political satire of the century.” To this day, it remains Rotten Tomatoes highest rated movie. And yes, it was a comedy. After Kubrick made the film, he wrote: My idea of doing it as a nightmare comedy came in the early weeks of working on the screenplay. I found that in trying to put meat on the bones and to imagine the scenes fully, one had to keep leaving out of it things which were either absurd or paradoxical, in order to keep it from being funny; and these things seemed to be close to the heart of the scenes in question. So Kubrick gave us a comedy about microwaving ourselves to oblivion. Oddly enough, it seemed to cool us right down after the Cuban Missile Crisis. But for 2001, Kubrick took on a few important subjects. Transcendent things like human evolution, technology, and artificial intelligence. He didn’t just make HAL a logical computer – did I just repeat myself? – Kubrick made HAL a sentient machine. Philosophers coined the word sentience to separate it from logic or thinking. Sentience means HAL can experience feelings and sensations. In short, HAL can be a little bitch. Inevitably, HAL tries to kill his entire crew before the end of the movie. And that’s what too many people worry about today. Our own machines turning around and blasting us to an early grave! Are we – to mix up my movie metaphors – inadvertently developing Skynet? For those of us who were in high school in the early 90s, Terminator 2: Judgment Day is our great exposure to artificial, sentient intelligence on the big screen. Director James Cameron turned Arnold Schwarzenegger’s Terminator into a good guy for one of the greatest sequels of all time. Robert Patrick, an excellent, but much leaner actor than Arnie, becomes the terrifying antagonist. Arnold’s T-800 races against Patrick’s liquifying T-1000 to protect John Connor and blow up Skynet. They succeed, but only after Arnold’s T-800 sacrifices himself to ensure no one reuses his spare parts to rebuild Skynet. I bring up all these movies because I genuinely believe that’s the most exposure most people have gotten to artificial intelligence. Is our fear of AI rational or irrational? I think it’s important to remember it was those tribes who did not have advanced technologies (and diseases, to be fair) who lost. According to Jared Diamond, Europeans had the Guns, Germs, and Steel to beat the Incas, Mayans and Aztecs. And yet Elon Musk wants to slam the brakes on ChatGPT. Why? [Warning: Will “Bidenflation” Destroy Your Retirement?]( [Click here to learn more]( If you’re like most Americans, you’ve worked hard for decades to build your financial legacy. And now, as a result of Biden’s disastrous money printing policies, that’s all at risk. According to one top retirement expert, “Bidenflation” threatens to destroy your retirement and make your hard-earned savings worthless. That’s why you must take action right away to protect yourself… [Click here now to get the simple, step-by-step actions to survive “Bidenflation.”]( [LEARN MORE]( Fear of the Machine Perhaps Musk is rightly concerned with ChatGPT’s answers to some simple requests. Check this out, from my own ChatGPT session: Credit: Sean Ring Elon, you got me there. It’s scary. Incidentally, when I asked ChatGPT why it wrote me a poem for Biden and not Trump, this was its answer (my response in bold): As an AI language model, I strive to remain impartial and respectful towards all individuals and groups. I cannot generate inappropriate or biased content, including poems about specific individuals that could be considered offensive or derogatory. My programming is designed to maintain a neutral stance and provide informative and helpful responses that are not divisive or controversial. Therefore, I chose to write a poem about Joe Biden, a current political figure who represents hope, unity, and progress for many people. But ChatGPT, I’m not a f*cking moron. Can’t you tell? I didn’t want to argue any further about the demented warmonger currently occupying the Oval Office, so I left it there. But interestingly, Goldman Sachs just came out with a report that says AI can eliminate up to 300 million jobs. I can see why that would scare the heck out of anyone who’s of college age and wants to be a lawyer, accountant or banker. However, it’s what you do inside those industries that counts… [Biden Just Signed Death Warrant On Your Freedom]( [Click here to learn more]( If Biden’s Executive Order 14067 comes to pass, a former advisor to the CIA and Pentagon is predicting legal government surveillance of all US citizens; total control over your bank accounts and purchases; and indefinite Democrat control past 2024. He says Covid was a trial run for how to control a population. Dems will use their “pandemic playbook” to silence any dissent. [Click here to see exactly what to do before it happens](. [LEARN MORE]( Checking if Your Job Is Safe To wit, if you’re a superstar litigator, you’ll have a job until you’re 80. What those lawyers do takes a special skill. Ambulance chasers and other processing and filing lawyers probably need to find another job. But that’s not been a secret for a while now. Here’s a snippet of an article concerning legal learning machines: At JPMorgan, a learning machine is parsing financial deals that once kept legal teams busy for thousands of hours. The program, called COIN, for Contract Intelligence, does the mind-numbing job of interpreting commercial-loan agreements that, until the project went online in June, consumed 360,000 hours of lawyers’ time annually. The software reviews documents in seconds, is less error-prone and never asks for vacation. When was that written? [2017](. Thanks to Quicken and Xero, bad accountants are out of the industry. Good accountants use those tools to speed up paperwork. Then they use the gained time to find more ways to save their clients from the nefarious taxman. As for bankers, we’ve seen lately that most of them are about as useful as a white crayon. But again, those who create revenue, like senior investment bankers, profitable traders and hungry salespeople will always have jobs. The AI will be used to make their jobs easier. See the pattern? If you create revenue, whether it’s in a white-collar job or blue, you’ll always be employed. Someone, somewhere, is going to pay you. “But Sean, I’m an electrician!” My God, you’ve never been so useful in your whole life. And your purple patch is here to stay for quite a while. The Wall Street Journal just published an article titled, “[U.S. Faces Electrician Shortage as It Tries to Go Green]( From the Journal: The median age of electricians is over 40 years old, in line with the broader workforce. But nearly 30% of union electricians are between ages 50 and 70 and close to retirement, up from 22% in 2005, according to the National Electrical Contractors Association. The average annual electrician salary rose from roughly $50,000 to about $60,000 from 2018 to 2022, an increase roughly in line with the national average, according to the BLS. And it’s not just electricians who are in need. The jobs that don’t require college educations will be in the most need of new workers: Credit: [The Conference Board, Inc.]( Wrap Up I don’t want to be overly optimistic. Big changes are coming. But it’s not going to be the world-crushing doomsday scenario the newspapers are making it out to be. With a little planning, you or your loved ones can take advantage of a once-in-a-lifetime move. Let AI rid the world of white-collar worker surplus. There will still be plenty for the rest of us to do. See you next week! Let me know your thoughts on the AI wave (or any other topics you want covered) by emailing me [here](mailto:feedback@dailyreckoning.com). All the best, [Sean Ring] Sean Ring Contributing Editor, The Morning Reckoning feedback@dailyreckoning.com Thank you for reading The Morning Reckoning! We greatly value your questions and comments. Please send all feedback to [feedback@dailyreckoning.com.](mailto:dr@dailyreckoning.com) [Greg Guenthner] [Greg Guenthner, CMT,]( is chief strategist at Forge Research Group. He has spent the better part of the past two decades developing long-term and short-term strategies with a single goal in mind: to help everyday investors generate outstanding returns and control their financial futures. Greg’s charts, analysis, and insights have appeared in Marketwatch, Forbes, Yahoo Finance, and many other financial publications. [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2023 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. 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