Energy is not merely electricity; it is the fundamental input to human civilization and the ability to impose order on the environment; without energy, humans cannot produce food, create shelter, transport goods, or maintain any complex society.

Government SPR (Strategic Petroleum Reserve) releases are optical/political responses to commodity price pressures rather than genuine solutions to supply constraints; releasing reserves temporarily lowers prices but does not address underlying supply deficit.

Commodity market pricing sends real signals to entrepreneurs and producers about where arbitrage opportunities exist and where investment is needed; traders who understand these signals can position ahead of physical supply responses.

Copper prices should remain elevated near $10k due to structural supply constraints (Peru political risk, capital allocation delays, environmental restrictions) combined with growing EV demand.

Exxon and Chevron reported earnings last week and are carving their way to new highs, making refiners and integrated oil companies the only leading sector in the S&P 500 year-to-date while energy overall is the only real game in town for equity performance.

Freeport McMoRan CEO Richard Atkinson expressed concern about where global copper supply will come from to meet Net Zero battery capacity build-out plans when listening to the scale of global Net Zero and battery production ambitions, suggesting fundamental copper supply deficit.

Marathon Petroleum reported Q3 earnings of $7.81 per share beating $7.00 estimates with $47 billion in revenues beating $41 billion estimates, ran at 98% capacity with 3 million barrels per day throughput, operating margin doubled year-over-year to roughly $30 per barrel, raised dividend, and initiated stock buyback, with the stock subsequently reaching new all-time highs.

The Chinese zero COVID policy has been a direct economic indicator for risk assets, representing a looming risk where China could lock down another 40-400 million people, which would undermine risk asset rallies, making reports of a politburo reopening committee planning to end the zero COVID policy by March a net positive for risk assets.

The commodity crude oil will snap back and catch up to XLE (energy stocks) sometime between now and end of year but certainly around the turn of the midterm elections because WTI is under its 200-day moving average while energy stocks are well above theirs, creating a technical and fundamental gap that Tony expects will snap shut.

The diesel shortage is the main story in the energy market, with the U.S. Northeast refineries unable to make up for shortages due to the Jones Act preventing floatation of diesel on foreign boats from southern refineries, creating structural supply constraints that keep crack spreads and calendar spreads wide despite inventory drawdowns.

Technology sector will continue to suffer into winter as long as upward pressure on 2-year yields continues, because even with white House respite hopes and Fed pivot expectations, 2-year yields remain in steep upward trajectory and pause at highs only when central banks intervene, reverting back when central banks go to sleep.

Saudi Aramco printed their second-highest earnings report ever today, demonstrating they have no problem getting paid on the offer for crude oil they're selling to Asian clients, serving as evidence that OPEC producers are finding strong demand despite political pressure from U.S. SPR sales.

Iran attack headlines create underlying bid to fossil fuels and represent headline-driven market conditions that are adding uncertainty premiums to energy prices.

October was one of the best months for equities over the past year, with market sentiment having reached extremely negative levels at S&P 3,600 lows with VIX in low 30s, all market barometers showing extreme fear, followed by coordinated central bank actions (Bank of England, Bank of Japan, PBOC) turning the yuan around that night, triggering the expected relief rally.

The S&P 500 tested up to the 100-day moving average gaining about 400 points from lows, reaching a pivotal technical moment, but subsequently failed the 100-day moving average resistance level and backed off in a reversal day ahead of the FOMC meeting tomorrow, exhibiting the back-and-forth volatility that has become characteristic of elevated volatility environments.

A White House headline suggesting Biden gave thumbs up to the Federal Reserve's pivot from rate hiking created initial market reaction in the U.S. dollar, but Tony could not understand the headline until a correction clarified the administration was expressing support for the Fed's pivot to hiking rates (not a pivot away from hiking).

In October, there was a dramatic sector rotation with 20-25% gains in EMPs and oil/gas, natural resources, airlines, aerospace/defense with about 18 sectors rallying over 10%, including metals/mining, industrials, financials, consumer staples, and healthcare, while technology nowhere in the set of leaders and even with Twitter deal going through, social media remains the worst performing sector of the year.

Technology stocks may see some short-term gains during retracement rallies if the Fed makes incrementally positive comments, but the sector won't be able to participate materially this year, unlike energy stocks like Marathon Petroleum which are carving new all-time highs on earnings days with strong fundamental and structural tailwinds.

After investors take losses selling Google, Apple, Microsoft etc., they will rotate into fossil fuel and energy sectors because these sectors are fundamentally intact, structurally intact, and have strong tailwinds behind them with visible earnings beats and momentum.

As a technician and price action trader, valuations don't really matter as much to Tony as they traditionally do, but having the valuation support for the energy story (4x vs 50x multiples) makes the energy positioning even more attractive despite being primarily a technical trader.