Economic theory can help make sense of the massive slide in stocks we've just suffered.» Read More
It's a metal whose performance tends to track the S&P 500 — copper. And over the past two weeks it's been falling like lead.
So with stocks soaring, what's the problem?
(Read More: Stocks Lower on China; AAPL at 52-Week Low)
Well, copper futures have been driven down by attempts by the Chinese government to take the air out of an impending real estate bubble. Stricter down payment ratios and higher taxes on speculative property are among several measures that could be implemented.
Facing a myriad of headwinds, Brent crude oil slipped to a six-week low below $110 per barrel on Friday, prompting some professional traders to think black gold will likely suffer further declines.
(Read More: Brent Crude Slips to $110 on Global Growth Worries)
Brent crude oil slipped to a six-week low below $110 per barrel on Friday, weighed down by growth worries as political gridlock brought the prospect of massive U.S. government spending cuts and on disappointing European industrial data.
It seems crude could fall further.
The price of crude oil dropped sharply Friday morning after seeing new swing lows and a close below the 200-day moving average. This market is poised for another leg lower, as the U.S. dollar is making new swing highs, and putting extreme pressure on commodity prices.
If the stock market continues to move higher, gold could continue to struggle.
In the last couple of days, we have identified a important correlation between the two. When the S&P 500 index plunged from 1,524 to 1,484 on February 25, we noticed a rush for safe havens, including bonds, the U.S. dollar, the yen and finally, gold.
(Read More: Gold On Track for Record Monthly Losses)
It's all about the Fed.
Federal Reserve Chairman Ben Bernanke is expected to deliver his semiannual testimony on monetary policy to the Senate Banking Committee on Tuesday, followed by an appearance before the House Financial Services Committee on Wednesday.
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