Is Oil topping? It certainly looks extended below, as it has accelerated to a third and increasingly unsustainable up trend angle. When crude broke long-term resistance in the $41-42 areas, at the end of July, stocks attempted another rally, in anticipation that crude oil would turn down against resistance. Once crude broke to new all-time highs, the short rally in stocks failed.
THE PRICE OF OIL VERSUS STOCKS
click for larger chart
Source: Decision Point Research
Carl Swenlin notes that “Oil has moved into uncharted territory and is above historical resistance levels. It could be headed for a major blow-off, or it may have moved permanently into the bottom of a new long-term trading range.”
Quote of the Day:
“To do the useful thing, to say the courageous thing, to contemplate the beautiful thing: that is enough for one man’s life.”
– T. S. Eliot (1888-1965)