General Comments
Market congestion is building for a volatile breakout - or breakdown depending on the market. 'Hurry up and go nowhere' trading is about to end, I suspect, with a strong stock market decline bringing commodities along for the ride starting Monday.
Energies
Critical technical resistance on crude oil within $2 of Friday's closing price should be sold into with stops above. Put buying is the preferred defined risk approach. Natural gas is a strong buy with straight calls for July or beyond. The heating oil versus rbob spread is actually just about right so no play there for now.
Financials
The S&P has shown significant strength bolstered by strong retail sales and economic rebound-like numbers coming out of several key reports. Sell this rally with stops above 1164 or with bear put spreads. I expect 25 points down by Wednesday if not sooner. Bonds remain a strong buy. The dollar is stuck in choppy land with no clear directions on how to get back on the road to the bull trend highway, but this week is setup to be a difference maker. Expect the dollar to run to 81.50 quickly on this bear move forecast in the S&P being the catalyst. I continue to standby my prediction that:........................more detail
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