Note from dshort: Randy Degner is a commodities trader for an oil company in Houston, TX. Here is a timely update on the analysis of this benchmark relationship that he shared last week.

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Key support on the GSCI at 5117 held last week for a sizable, though brief, bounce. Today's broad commodity sell-off leaves the GSCI looking very vulnerable. 5117 hasn't broken yet, but if it does, there really isn't another target nearby. The index could easily fall somewhere in the 4850-4625 range before stabilizing again.

Based on recent price action, that would put the S&P 500 somewhere between 1150 and 1200. That sounds like a big drop, but it would really only take equities back to where they were in the 4th quarter of last year.

"Sell in May, and go away?"