The BAM report has been short crude oil for months now and although the market tracked the model off the first sell signal (with a quick 10 dollar plunge to the downside during January) the market has since come unhinged from my forecast in what looks to me like a classic “last gasp” blow-off leg. 

There is nothing on a chart basis that would prevent Crude Oil from blowing-off into the 140 level short-term. 

Based on the current model, I’d say the odds are HUGE that we’re at a bubble TOP in crude oil that will rival the housing bubble TOP of the summer of 2005 and if I’m correct on that call a decline to the 50 dollar level looks conservative and we could actually be headed to the 26-36 dollar level within the next 18-24 months!* 

*Based on my “rule of four” whereby post-bubble prices collapse four times faster than they inflate. 

-JGS 

Full report coming soon