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And here’s today’s oil drop – which may or may not signal an important top in place. This oil bull has had a series of sharp two to five day declines that have punctuated the length of the rally.
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This oil weakness is, in part, a signal of economic weakness, as evidenced by the strength in the bond market today. Here’s a weekly chart of bonds suggesting that another intermediate-term decline in rates is underway. If bond prices maintain these levels through Friday, then the weekly cycle-trap indicator will turn up. This is very bearish for the economy and consistent with my outlook for continued ‘economic winter’ conditions prevailing in the financial markets.
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