Crude oil quotes are approaching a potentially important top, although it’s too early to say whether this will keep pump prices from hitting $3.00 by autumn. Focusing on the September contract, we’ve been awaiting a short-able peak at exactly $65.02, a little more than a dollar above yesterday’s record-high $63.99. Some Rick’s Picks subscribers evidently profited from crude’s most recent surge, buying the breakout above a hidden pivot I’d flagged at 59.85. A trailing stop would have allowed those who followed my advice mechanically to exit a few days later with a gain of about $1,600 per contract. We elected not re-enter the position because pullbacks since have been relatively shallow, but the target itself is still valid.

With oil prices blasting to new highs, it’s a wonder the decline in stocks yesterday was so subdued. One could get the impression that the bullish cyclical forces which have pushed shares tediously higher this summer are so persistent and steadfast that Wall Street could probably shake off Armageddon. Then again, perhaps a serious decline is imminent, a prospect that was raised here last Friday under the headline “Are Stocks Primed to Fall?” If so, we would presumably participate via some QQQ August 39 puts that we hold as part of a strangle with the August 40 calls. Meanwhile, we took partial profits yesterday in some D.R. Horton August 35 puts that we’d held for a while, free and clear. We were able to reduce their cost through timely profit-taking, and by calendar-spreading them against some short July 35 puts that expired worthless. With a profit already booked, we can afford to play the remaining puts down to the wire, since no loss is possible.