Gulf Stocks' "Death Cross" Suggests Crude Slide Has Legs

Tyler Durden's picture

After 7 straight days up, Middle East stocks sank overnight on the heels of dashed hopes of an oil 'freeze/cut' deal. The end of the dead cat bounce coincided with the formation of a "death cross" in Bloomberg's GCC 200 index which did not end well for oil or stocks the last two times...

The 50-day moving average crossed below the 200-day moving-average triggering the classic technical pattern known as the 'death cross'. As Bloomberg notes, the last time the double bearish signal occurred, in August 2015, the index of the largest and most liquid companies in the six-nation Gulf Cooperation Council sank the most since 2008 on a monthly basis.

Chart: Bloomberg

 

Gulf stocks fell for the first time in almost two weeks...

Chart: Bloomberg

Finally,  it appears oil prices have rallied over-optimistically, and with the failed talks coinciding with a 'death cross' we suspect oil will revert back - just as it did in July - to the equity market's view of the outlook for the energy complex...

Chart: Bloomberg

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Whiskey Badger's picture

My fellow ZHedgers, you must watch Sargon of Akkad:

https://www.youtube.com/watch?v=dCvyg679bsg

PS:  MillionDollarBonus is a bigot and a racist, destroy him when he posts.  Thanks in advance.

Yen Cross's picture

  WoW! I'm rethinking my long $usd idea. I personally think the market is caught long $usd.

  Look at the Cable run? Pretty cool!!!

Global Douche's picture

At the first of this crash, the shitty USD will talk the loudest. At the last, one's PMs will rebuild the economy. This makes way more sense as I no longer see any one Magic Bullet. Even bitcoin will likely do well

mikkip's picture

how many of these bearish calls do you need to get wrong (bonds/commodities/equities) before you stop posting them? your credibility is stretched to breaking point!!

 

Youri Carma's picture

Could Oil Test Low 30’s, High 20’s? Tim Wood https://www.youtube.com/watch?v=zMUHmFlkjBk

Last of the Middle Class's picture

There was never a deal, there was never a thought of a deal and there damn sure was never any serious talk of a deal. It's been pump and dump in crude for a couple of years now. Wake the fuck up.

lynnybee's picture

yes, we will be rebuilding a new monetary system from scratch & it's gonna be painful for those who do not have metal. silver will be remonetized, it has to be or we're all toast (i'm already old toast.)

zebra77a's picture

They do this over and over again, sucker in the bears before a bear trap, short crush ensues. Don't be a bear in oil, you will be trapped.

saveUSsavers's picture

WTI went from $43 and held near $50 DURING SAUDI BOND OFFERING period, down after Mission Accomplished?

MASTER OF UNIVERSE's picture

The long term trend on oil is obvious to anyone that was born with working eyeballs, and a brain, with the exception of Economists, & Central Bankers, of course.

Codwell's picture

I hope oil falls a bunch, I always wanted to drive to Australia.