Hello traders everywhere! Adam Hewison here, discussing the situation in Iraq and how it could possibly affect the US and world economy.
After spending over $1 trillion and having lost the lives of over 4,500 brave Americans in Iraq, the country has once again imploded. I don't have to reiterate what is going on with Muslim extremists, but it seems they are hellbent to take over Baghdad, the capital of Iraq, and the rest of the country. It would appear now, Muslim extremists feel empowered to push their views to the max.
The Middle East has always been a problem waiting to happen, ever since the British left in the 50s. Arab unity seems to be the major problem in this area and one that's been going on perhaps for centuries.
I've always believed that the west's principal interest in that region was because of the crude oil (NYMEX:CL.N14.E) under the sand. I'm positive we would not even be there if they did not have vast resources of energy that the world is addicted to. The question now is, what is going to happen if Iraq and the oil fields are taken over by Muslim extremists and Iran? Should that happen, and the odds are becoming more and more likely that it will, it will produce a world that is totally different from what we know now.
I have been positive on crude oil (NYMEX:CL.N14.E) since May 19th at the $101.98 level (currently trading at $106.98). This market has the potential to continue in a very positive manner and move substantially higher, possibly to the $120 to $125 a barrel area.
How is this going to affect the US stock market? The US stock market has been moving steadily higher since making a low in March 2009. By any standards, this is a mature bull market that is now over five years old. The market was originally driven higher by multiple QE experiments by the Fed. The Fed has begun to taper and reel in their extraordinarily ambitious, and some would say reckless, monetary policy. With no QE to support the market and with energy prices jumping dramatically, it can’t help but affect everybody in the country.
In today's video, I am going to share with you some of the early warning signs that you should be on the lookout for. They may help you decide whether you should stay or exit what is going to be a very, very interesting market in the second half of the year.
Every success with MarketClub,