Both the Stock Market and Crude Oil Stand at Key Junctures
- There is no question that the extremely strong correlation between the bond market and stock market that had existed during most of November has broken down over the past two weeks. Given the “outside days” in the S&P 500 and Russell 2000 yesterday, this is not a good development for the stock market bulls.
- WTI crude oil is getting oversold, so it should bounce soon. However, the $70ish level for WTI is a VERY important support level. Therefore, if it breaks below that level in a meaningful way at any point in the coming weeks, it will force us to rethink our bullish longer-term stance on this commodity.
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