Crude Appears to be Fading Somewhat Aggressively at Resistance & In Context of Seemingly Bullish Headlines
The chart below plots crude on a weekly basis.
The commodity appears to be fading rather aggressively (i.e., -550 bps on the week so far) at the combination of resistance lines (1) and (2) drawn off its 2012 highs and 2009/2011 lows, respectively.
We find this bearish price action noteworthy as it is coming in what has been a headline “panacea” of sorts for crude over the past week given renewed MENA riots/protests as well as Israeli leadership suggesting Iran will have “the bomb” within the year and must be stopped beforehand.
As we have suggested before, weakness in commodity-land may not necessarily translate into equity weakness and the overall risk on/off environment we’ve become accustomed to over the past ~4-7 years may be a thing of the past.
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