Stock indexes higher, oil sells off

I’ve been taking a long weekend, so will try to get back to posting charts on Wednesday. However, briefly, the indexes rebounded today apparently on lower oil prices. On the last chart I posted I drew a couple of green potential support lines. On Friday the S&P broke through the first of those lines, but today (Tuesday) the S&P was able to close slightly above that support line, thus rejecting, so far, the downside breakout. The Nasdaq has been somewhat stronger, and actually held that support on Friday (drawn from the same pivot as on the S&P) and bounced nicely higher today, with about twice the percentage gain as the S&P, and turning momentum back to the upside. But volume fell on the advance, so the bounce is somewhat suspect. Also, the Nasdaq advance/decline line still looks terrible. Oil and gold were both lower. There were some momentum divergences in crude if you look hard enough at several indicators, but the trend is still strongly up, so divergences can fail many times before the trend actually changes. There is evidence that there has been a blow-off, but I’d rather wait for the first retracement back up after a break, rather than trying to pick the top.

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