Airlines Continue To Rally As Oil Slides

As you can see in the above chart, falling oil prices is bullish for the airlines. There is a very good inverse relationship between oil and the airlines. Crude oil clearly broke through support while the airlines have broken through resistance. I still think oil can go down to 48 dollars which should mean there is more upside for the airlines.

Everyone was waiting for cold weather to drive oil prices back up but a cold day like we had today here in NYC wasn't enough to cause a rally. Seems like there has been an unwinding out of commodities these past 6 weeks and I think there is more to come.

On a seasonal basis, crude oil usually bottoms in late February or early March so we may have some more selling pressure for the next few weeks.