Glut, Glut, Goose!

The massive inventory build just released during the weekly report for crude oil is sending the USO ETF spiraling lower, enough to goose oil bears to make a move in front of the FOMC later.

We know energy stocks have been fickle for a while now, in terms of sustaining upside moves. But many petro-sensiitve emerging markets (Russia) and a decent amount of energy firms had been holding out, waiting for crude to show more strength. 

Instead, USO is back to fighting for its life.

On the daily chart, below, note crude clinging to that lower support light blue line, dating back to the winter lows for what still may be a major bear market bottom. 

However, buyers lost their grip on ending that debate with this latest bout of selling. At the moment, they simply are trying to prevent against a retest of those lows, or worse yet, a breach of them. The recent head-fake higher in natural gas I am sure is not helping sentiment in the energy patch, to boot.

As a result, the precious metals and miners, and assorted other miners, are much more enticing here on the long side than energy stocks, the latter simply searching for stabilization.