Nothing can trump oil when it goes down. No amount of good news. So once again the markets sold off, the dow sinking 89 points, the s p losing 0. 38 . Were not going to get out of this Oil Conundrum easily. As ive told you many a time, you can deride it all you want, the linkage, absolutely. But you see, you cant dismiss the fact that oil is in control. And weve got a very firm pattern going here. Oil is a hardtime rally on the fundamentals because we have a dramatic glut thanks to aggressive pumping really by the saudis. The correlation with the stock market revolves around demand. The supposition is when oil is weak, its because of u. S. Demand weakening. Therefore our economy must be slowing. This linkage will not break until it breaks. See, we dont know when the market will come to its senses. The oversupply drives oil down to the 40 level. Right now its at 43. When we got to 40, you know what happens . Like clock work, the renewalors begin that the saudis are going to cut back or
Were not going to get out of this Oil Conundrum easily. As ive told you many a time, you can deride it all you want, the linkage, absolutely. But you see, you cant dismiss the fact that oil is in control. And weve got a very firm pattern going here. Oil is a hardtime rally on the fundamentals because we have a dramatic glut thanks to aggressive pumping really by the saudis. The correlation with the stock market revolves around demand. Weak, its because of u. S. Demand weakening. Therefore our economy must be slowing. This linkage will not break until it breaks. See, we dont know when the market will come to its senses. The oversupply drives oil down to the 40 level. Right now its at 43. When we got to 40, you know what happens . Like clock work, the rumors begin that the saudis are going and then what happens . Crude rallies. It rebounds to the 45 to 47 range. Taking the stock market with it. Because the buyers of stocks dont seem to care how oil surges. They just assume its because of
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