Following is a chart of WTI – can see the contraction in bollinger bands that typically presages a break out.  A little over a week ago, I suggested this was rolling over.  Now I am not so sure.

WTI could break either way.  Taking out the recent high just under $74 would suggest a target of around $100 (6.18% retracement).  A break lower would see a move to $50ish pretty comfortably.  Think I’m favouring a break higher – would fit with the bullish move in gold and breakdown in Treasuries – signalling fears of inflation, competition for increasingly scarce real money, currency volatility etc.

Following are the charts of DIG (leveraged oil and gas long ETF) and USO (oil and gas ETF).  On the face of it, the price action of both looks bullish – the leveraged ETF has already broken higher while USO is pushing against the ceiling.

Finally, some Australian stocks that I have had romances with over the years:

Both AWE and BPT are looking particularly healthy – having recently tested lower.  (I have not been following them as closely as the past – but both have strong balance sheets and growth prospects – AWE from drilling, BPT from unconventional gas reserves – hence why they reside on the watchlist.)  WPL is a little more difficult.  When it was in the clouds back in 08, my analysis had $55 being an optimistic fair value as it required exceptional compound growth rates with continuing elevated oil prices.  However, the green light on Gorgon has changed the ground rules here – so need to revisit the numbers.