The Squeaky Wheel Gets Oiled...

Or so they say. Let's see what happens at tomorrow's OPEC meeting. Already, Venezuela is calling for higher prices in 2011 within a range of $90 to $100, stating: "Well, I said that we hope to have a new price in the future. We have to see and discuss. You know the quota system is a very complicated position. We are not in a position to discuss now.”

Unfortunately, Saudi Arabia reckoned that prices between $70-$80 are already quite satisfactory. Talk about being easily pleased. FT has an extensive report on this meeting in case anyone wants to see it all. The world's largest oil trading house, Vitol, forecasts prices between $70 and $85. Vitol's going on my permanent watch list too - right next to Glencore. Interestingly, both are Swiss.

So, the question is where is oil headed next? And is it necessarily bad if it remains in a range? More importantly, what are the implications for CENX, my new love interest?

I studied a one-year oil chart and compared it to the one-year CENX chart. The correlation is pretty strong and rings clear as a bell. I then tried to see whether there was any correlation between Shanghai and CENX. The correlation isn't as strong, surprisingly, even though there are many reports indicating that China is a major driving factor of profitability in the aluminium sector. Then, I compared CENX with FTSE and we had a correlation that is essentially the same oil, which means FTSE is even more tightly matched with CENX than the Shanghai chart. So what does this tell me?

FTSE is now coming full circle, running the sellers who sold back in March or April. So, it's likely CENX will do the same. The way the two charts accelerate seem very, very similar. They've got the same personality. So, CENX started out the year with a bang, opening at about $16.71. And I'm keeping my eyes on the ball - watching the $14-16 range more cautiously than ever. If FTSE hits the 5800 level again, CENX should have some more upside yet.

In terms of timing, the wok's very hot once again due to Earnings Season, but I fully expect a pre-election day lull before Santa comes along. So I'm going to wait for the momentum to build before selling anything, even though I have to admit I'm quite anxious. What? I'm just entering a new phase here with my PDO nearing completion. It's a big deal and CENX's -1.67% move today didn't give me any assurances, although Harry seems to desire my attention.

Report Card:

+1.05% on the SBA
-0.31% on the Roth IRA