I am shocked on the scale of commodity fall out today.

The markets felt like something’s up in the last couple day’s but this look’s absolutely overdone.

Even more weird is that stocks held up nicely.

It almost looks like something blew up (hedge fund, trading desk, somebody’s cross-asset hedges) and needed to wind down fast.

We will know in the coming days if something happened or this is self-fueled panic and margin induced sell-off.

I have put some light longs in the last hours of trading. Yeah…maybe not smart, but we are talking here about 4+ standard deviations moves (1 in 15,787 event, so expected to occur once in 43 years) so I felt tempted. Waiting for the commodity plunge protection team. Will close fast if this continues tomorrow.

We will see what happens.

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Initial jobless claims in the U.S. were reported at 474.000 vs. 410.000 consensus and last week revised (up 2.000) reading of 431.000.

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Again the price of oil is not determined by the fundamentals but the last couple day’s new hit scare – deflation.

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