DUG

I initiated a position in the DUG yesterday before the markets close while Oil rallied on China Stimulus Speculation and less domestic supply. I left the trade open through tomorrow with a +10% cushion, I still think Oil at $43.70 is at the top end of the 6 week trend...I expect Oil to continue to sell off tomorrow especially considering the extreme weakness in the US equity market and lack of clarity surrounding further stimulus in China...Well also see another unemployment number tomorrow and if jobless claims are once again higher than expected it will only expedite the sell off..

Today T. Boone Picken's said well see $60 oil before we see $39, obviously my money is on the $39 mark but well see..

As far as equities this extreme freefall looks like it will take us to 600 level in the S&P... 50 on the S&P Earnings x a 12 Multiple gets you 600, still a giant leg down to go...