The calamity that tore through the commodity and currency markets Thursday is not likely to be a one-day event, investment professionals say.
"Markets don't just kick back immediately," independent trader Dan Dicker tells the Breakout crew, "especially when there's massive margin selling."
He likens the commodities market to a seven-layer cake of risk and money, pointing out that the hottest, most flighty money is what's on the move right now. Even my co-host is channeling his inner caveman and lobbing limbic system analysis into our assessment.
But before you get all fundamental on me, let's not say that ALL OF THIS was set in motion by a bounce in the dollar from dramatically oversold levels. What has been most notable so far is the relative resilience of the stock market, which held up nicely and parted ways with its lock-step dance with rising crude.
"Anyone selling the stock market thinking that it's still correlated to what's going on in the commodities market is going to get their head handed to them," Dicker says in his trademark locution.
When you think about it, rising stocks-rising oil is really a nonsensical, mess of a trade. So it being Friday and all, let's go out and fill our tanks with "gasoline expectations" and then drive to the mall and spend our "savings."
Enjoy it while it lasts.
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