Thursday, July 14, 2016

Which Way Does Oil Need To Go To Cause A Stock Market Crash?

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*Historically high oil is associated with down markets.
*Because of the weak state of the US energy producers, low oil could cause a jump in bad loans.
*That could tighten the system and ultimately crash markets.
Historically a jump in oil prices are associated with down markets (NYSEARCA:SPY). Down oil has led to up markets. We recently wrote that we see oil turning lower (here and here). We want to show how this time a FALL (not a rise) in oil prices could be the key to hit markets. Falling oil prices can exacerbate a US credit problem. That would jump rates, tighten credit and potentially crash markets.
Oil appears to have entered a down trend
Here's the chart.

Chaim Siegel has been working with hedge funds and mutual funds as an analyst and PM his entire career. Chaim specializes in earnings and predicts, analyzes and reacts to earnings and earnings events as well as developing current company stories with a hedge fund perspective. If you want his analysis real time sign up to the right for real time email alerts. #in, $spy, $qqq, $iwm, $vxx, $ycs, $fxe, $EUO, $YCS, ^GSPC, INDEXSP:.INX, #elazaradvisorsllc, CME Globex: ES Disclosure: These trades can lose you money and principal especially when using leverage BY USING THIS SITE YOU AGREE TO TAKE ALL RESPONSIBILITY FOR YOUR OUTCOMES AND LOSSES AND HOLD BESTIDEAS, ITS CONTRIBUTORS AND ELAZAR ADVISORS, LLC HARMLESS