So it's the same old cue, throw money at the problems and hope the problem goes away (which it doesn't) then go into denial when they (central banks) have caused an imbalance somewhere else. But as most central banks have now become a mechanism for insane behavior ( trying the same thing over and over expecting a different outcome) it's the central bankers who don't really know how the markets operate.
Regardless, this cash liquidity pump, caused weakness in the US dollar and sent oil higher. A nice trade off if you devalue the USD via various money print operation, either though the Feds $600billion print job, which has been a flop and will continue to be a flop, add the ECB and IMF money pump effect and you'll see commodities that trade against the USD rise. Such as oil.
The psychological break point or oil 'crunch', in my opinion is $90, this would be more a Chinese problem as they are grappling with the signs of hyper-inflation (e.g go to the shop to buy some pork see a price increase, a week later it increases in price again). A higher oil price will tip the Chinese economy into a 'inflation' crash.
Oil is now sitting at $86 a barrel, looking slightly overstretched, looks like marked up distribution buys against a USD hedge. Corrective sell is there as most moving averages are pointing to a $80 support. However a spike to $90 (near term) is a distinct possibility if the USD is offered over oil.
But it is all China, watching Shanghai composite weakness (stocks) for tightening of the Chinese ecomomy, as China has a supply (overcapacity) problem, inflation, mixed with a soon to be oil 'crunch'.
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