Over the weekend, I read a weekly newsletter which covers Warren Buffett and Berkshire Hathaway stock (1) They pointed out that Berkshire continues to accumulate shares of OXY ($64) at ever increasing prices. Today, May 16th, 2022 despite the stock market having a flat opening, with oil prices slightly lower, OXY made a new high.
Does Buffett’s team know something is up ahead that will again drive the price of oil higher in the face of a slowing economy?
Because of Covid-Omicron lockdowns, and debt problems in the property sector, China reported much lower business activity yesterday, then had been forecasted. A business slowdown in China, together with next months interest rate hikes by the Federal Reserve should be negative for oil demand, and oil prices. So why is Buffett becoming more aggressive?
For those of my readers who follow technical analysis, I should point out that the chart for OXY shows a potential “Golden Cross.” That is when the 50 day moving average, moves above the 200 day moving average. However, the daily price of the stock is significantly higher than the cross over price, which suggests potential correction risk.
This information is for educational purposes only, and has not been verified, It is not investment advice. Readers are strongly urged to contact your own personal investment consultants and brokers, before taking any market actions. The author and his staff may have positions in any stocks mentioned in these articles and may make changes in line with, or counter to the information presented.
(1) The Free Weekly Newsletter is called:
(CNBC) Buffett Market Watch and is well worth checking out.
Monday, May 16th 2022