The Market Perspective

6/20/2025

Crude Oil Up 25%

Brent oil futures settled Thursday at their highest value since June 22 pushed by conflict in the Middle East

WSJ today

West Texas Intermediate traded at $60 May 19. This morning July delivery is trading at $75. The $15 jump since then has raised the price 25%. And energy and service stocks have rallied. Expanded drilling occurs when firms believe the new well will improve their bottom line. That is what a $15 increase will do.

But, not so fast.  So far, nothing has happened to decrease the supply of oil.  The Israelis have not bombed Iran’s tanker export center.  Transocean RIG gained 50% since its April low.  It has backed off its $3.35 high to trade at $2.94.

As in the 1930s, there are isolationists like Marjorie Green and Tucker Carlson who oppose any US involvement. Menachem Beg, Prime minister of Israel in 1981, set a precedent. No enemy of Israel would be allowed to go nuclear. He sent F 16s to destroy Sadam Hussein’s attempt to build a reactor. Rather than being applauded for protecting his country, he was criticized by no less than then President Ronald Regan. The F 16s were for defensive not offensive purposes. But as Begin said, we may be criticized but at least we will survive.

Netanyahu has now done the same by attacking Iran’s various nuclear sites. But the Fordow complex remains. Located some 200+ feet under a mountain, it eludes Israeli attack. Only the US has a 30,000 pound bunker buster bomb capable of reaching the underground site.  President Trump says he will decide in two weeks whether to attack.

It is clear that Putin saw the green light on an Ukraine invasion when Biden withdrew from Afghanistan. We are now at a similar moment. Moscow and Beijing are certainly watching to see what the US will do. Iran has been the chief architect of terrorism since the Shah of Iran was replaced by the Mullahs. Whether the US will continue to support Ukraine or would aid Taiwan in the event of an attack is on the table. In this case, the whole world is watching.

The stock market is going nowhere in typical summer fashion. All the money injected by the FED during Covid will yet cause problems.  White House and FED claim inflation has cooled. In fact, the rate increase in inflation is down. Prices are still high.

Equal weight stock indexes are slowly falling.  Microsoft cuts its workforce by several thousand. Amazon struggles to improve its revenue per employee. The demand for warehouse pickers and delivery drives make that difficult. The stock market has yet to commit to a definite direction.

6/19/2025

I thought the President had important things to do.

I guess not. 

This is not a political weblog. But the poll reflects growing negative mood by the public. Trump is surely the most thin skinned President of modern times finding time to argue with anything negative bout him or with Bruce Springstein. Today he is agreeing not to deport farm workers. The on and off again approach to everything makes planning difficult, hence doubts on the economy. 

 

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Donald Trump slammed a Fox News poll Thursday on Truth Social, accusing the network’s pollsters of being “always wrong and negative.”

“The Crooked FoxNews Polls got the Election WRONG, I won by much more than they said I would, and have been biased against me for years,” Trump wrote, referring to the 2020 election, which Fox correctly said that he lost. “It’s why MAGA HATES FoxNews, even though their anchors are GREAT.”

“I hate FAKE pollsters, one of the Worst, but Fox will never change their discredited pollster!” he added.

A Fox News poll released Wednesday shows that a majority of voters disapprove of Trump’s job performance by an eight-point margin. The poll, regarded as one of the best in the industry, found that a majority of voters are still feeling pessimistic about the state of the economy. 

 

Tom McClellan on how 2022 looks like 2025

6/19/2025

 

Summer 2022 looks a lot like summer 2025

Peter Shciff on The Economy

6/19/2025

Peter Schiff on the Clayman Countdown

 

This sounds much more like Tom McClellan or my friends at Elliott Wave. 

Buffet is Buying T Bills

6/18/2025

Graphic of Buffett Cash

Has Wave Two Topped Yet?

6/18/2025

It looks more probable for stocks. 

Bond yields may fall a bit further before a large rally to higher yields.

SIlver is over done and may pull back, if so load up on Sprott silver.

Narkets close tomorrow open Friday, will look at charts tomorrow and post. 

Wave Two U[date

6/16/2025

While the SPX made a new high only 2% of the stocks in that index have made a new high, the reason is the over weight of tech stocks. 

Frankly there is not much else to say until this back and forth between bulls and bears is resolved.

In my post Friday I said we need more evidence the top is in, that analysis is unchanged. 

Ditto for bonds though I do not see how the FED can lower rates with oil over $70.

And see previous posts on social mood, it is only getting worse. 

Click here for a typical critical of the Trump parade.

And they are right  he never served but wants the Army now to make him look good.

The bigger point is that social mood is fragmenting and falling apart. 

 

 

Has Wave Two Finall Peaked?

6/15/2025

The media will say the sell off Friday was the result of the Iran attack, and rise in oil price. I suspect Wave Two from April 7 is fiinally topping after it has fooled us by going higher

Here is the DJIA chart, I drew the blue line some time back at the height of the previous fourth wave, a common retracement

The red arrow at top shows RSI has dropped below 50%. At bottom it shows PMO peaked  in mid May. This suggests momentum has run its course. 

For some reason typepad is having difficulty posting charts so let me comment. The Value Line Geometric, unweighted, and SPX mid cap have led the way down and dropped Friday. 

The NYSE Advance Decline line daily tuned down. 

In the column Friday I suggested we needed more downside, and yes the market could still rally.Bu this looks more like the start of Wave 3 down.

I wrote the Friday Column about  10 00  AM CST.  The bond market was still up which made no sense with fast rising oil prices. By day end it had turned down.

Time to buy TBF the bear bond fund. 

Gold is on a tear to new highs. Silver finally joined the party but is already over bought. Silver has been unreliable pulling back and not joining the gold rally. I would rather see silver pull back before buying or place lower orders in PSLV. PSLV is the Sprott silver trust which owns the metal, not a collection of silver miners. 

Social Mood

Markets advance amid positive social mood. They fall amid negative social mood.

This all looks like the 1970s to me, higher oil and gold and interest rates, lower stock prices. 

We have country wide riots,  items thrown at police. Legislators were shot this weekend. We have shooting wars Iran and Ukraine.

Here in San Antonio a lady with no municipal experience was elected Mayor. She lost two Congressional races. She ran opposing Trump beating a Republican endorsed by the Governor. That endorsement elected her.  Usually such races are not partisan, this was. 

Don't laugh, I recently posted a list of some 25 new horror movies in release. This is another feature of bear markets, think The Exorcist 1973. 

 

 

 

Debt Ceiling Crisis Ahead

6/14/2025

Click for history of the debt ceiling

Crude Vaults Over $70

6/13/2025

Crude Oil Vaults over $70

Early Friday morning, local time, Israel launched dozens of strikes against Iran and declared a state of emergency, according to Defense Minister Israel Katz.

ABC News Today

Crude oil has advanced to $64.59. This is just a few cents shy of resistance at $65. Clearing $65 gives a next target of $70.

This column last Friday

As I write this Friday morning 6/13/2025, crude oil has jumped about $5, last quote $72.67. As noted last week the chart was already in bullish formation. The event of an Iran attack was the fundamental event that verified the chart pattern. Gold by is up another $56 today to a new high of $3,459.  

Here is some historical perspective. In the last 1970s gold and crude oil were soaring Crude went from $10 in 1979 to its final high of $36 in 1981. Recall that maximum social mood occurs at the end of a pattern.  Those two markets back then were a good example.  The fear of missing out FOMO had ‘investors’ piling into gold an oil. However, the logic behind rapid rises in both markes is never good. Numerous adds for gold remind us that the dollar has lost 95 its value since, well pick a date. Then, 1979, crude was rising because of a second oil embargo.  Now it is rising because of war. Notice this is   not just the threat of war but a war between Israel and Iran. One can date this back to the Hamas attack on October 7, 2023. 

This was not good news for the stock market, The Industrials reached 1,000 for the first time ever in 1966. The index pulled back (TET offensive, US riots) and then reached 1,000+ again in 1972, It then tumbled from 1,040 to 577 from 19793 to 1974. By 1982 it was only trading at 800.

This column has suggested topping action in the indexes for some time.  Today the Industrials are down 534 points.  On my www.themarketperspective .com blog I suggested the earlier declines this week would need more drop to suggest a top to the rally from April 7. The news will cite the Mid East events as a reason and a normal pull back from the rally. The indexes gapped down on the open today. We will need more decline to confirm a top.  I expect we wil get it. We have riots unfolding amid political animus here. Wars occur in the Ukraine and Iran and Gaza. Did anyone notice the riots it Ireland?

One market that is not conforming to history are bond prices. Rises in gold and oil should depress bond prices. I suspect this is the belief that Powell  will succumb to pressure and drop interest rates. He should not do so in light of the events occurring now.