Both just opened and crashed to more than 5 year lows, not seen since 2009. Dr. Copper crashing on the world growth outlook, oil, well that's obvious, however what's not quite so obvious is the conventional wisdom of lower oil prices means lower gas prices which means more consumer discretionary spending. Oil has been low and moving lower for sometime, this week's consumer sentiment has not been good and the real reasons for it like a +300k Initial Claims print when you'd think retailers and the such would be hiring for the holiday season, certainly not firing en masse as well as sub-indicies in data like the Richmond F_E_D showing the employment index and average work week both down- the hard data behind the sentiment.
There's a lot more to the spider-web effects of what has now essentially become an oil price war with the Saudis (our allies?) crushing the US shale drilling industry, removing competition as oil is priced lower than most US shale producers can even get it to market, which is about to result in a spate of bankruptcies and worse, defaults , especially in the HY credit space which is going to be in the spotlight over the next several weeks and months, but I'd think as early as today as the OPEC decision's effects are front run.
If you are old school, then this morning's Dr. Copper plunge is very telling...
Copper- DJ total return index with a gap down to more than 5 year lows.
And WTI (West Texas Intermediate) Crude, also gapping down to more than 5 year lows.
Good thing the USO charts on Wednesday didn't show anything of interest as we chose to forgo this possible trade calling it "Gambling", indeed...
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