Let’s notice that today’s action in Natural Gas– a new recovery high at 3.105 followed by a vicious downside reversal and decline to 2.954 so far– represents key downside-reversal action, and at the very least, indicates that the upmove from the April 27 low at 2.44 ended today at 3.10.
SPX tested triangle resistance yesterday and didn’t break through it. There is a possible setup here for a reversal back into triangle support in the 2055 area and that’s shown on the chart below that I posted on twitter last night. We’ll see how today goes, but if triangle resistance holds again today then we will most likely see at least a test of Tuesday’s low at 2083.24. SPX 15min chart:
It seems all the yammering about oversupply in crude oil is meaningless (as, it seems, 99% of the worries posted on ZH turn out to be). Crude has been strong for a solid month now, and it has since vaulted over its descending trendline.
I was talking yesterday morning about the negative divergence on the SPX 15min RSI and that has delivered a retracement. If rising wedge support breaks this morning then I have strong support at the 38.2% fib in the 2085 area, as that is very close to the 50 hour MA. I have alternate fib retracement targets in the 2078 and 2071 areas. SPX 15min chart:
Until March 13, energy stocks were a total kick on the short side. Since then, they’ve been clawing their way back, right alongside crude oil. I have no interest in shorting crude, but as we approach the key gap I’ve pointed out below, I’m more and more interested in getting back into the short side of energy stocks.
I’ve already in a few energy positions right now; namely: BP, CLR, CSIQ, DOV, FSLR, GPOR, HFC, IOC, NBL, OKE, SM, and WPZ.
As for my portfolio in general, I amped things up Tuesday. I went from 52 short positions to 75. Let’s see what effect, if any, the Fed Minutes have on Wednesday. The meat of any move may not take place until we get a critical mass of earnings reports over the next few weeks.