Over the weekend, we wrote a piece in which we showed the correlation between crude oil and stock markets, read How Panic In Crude Oil Is Driving The Sell Off In Stocks. Where Will It Stop?
Basically, we showed in one chart how periods of panic in crude oil, since August 2014, has resulted stocks to sell off. Today is not different.
Stock markets globally started the day in green, to lose most of the gains at the close. Uncoincidentally, the tipping point in the day was exactly the same time when crude started to head south. The charts say it all.
Basically, crude oil is still controling markets right now. However, after examining the crude oil charts in our previous article, we concluded that the worst is over for crude oil, and, hence, also for stocks. Although the ongoing panic can continue for a couple of days, we believe there is at least a medium term bottom being formed somewhere here.
