On the surface it appears as if the bulls and the bears came to another impasse today, but there was actually a small technical coup by the bears today. A number of chartists who I keep in touch with have drawn a head shoulders neckline in the March S&P futures at the 1422 level. Today the the bulls were unable to keep the March futures above that level; the March contract closed at just under 1421. Just another piece of the puzzle to watch, for there to be a really serious problem, the chartists see pivitoal support needing to be broken at 1413 on the contract. (sorry that annotations are lacking in this futures chart...) Alcoa may give the bulls something to work with Wednesday - better than expected earnings: (Click here)
Crude oil came back smashingly from the low print of $53.875 earlier this morning. Bear in mind we've had a string of weekly crude oil draw downs leaving inventories enough below year before levels to raise some eyebrows. Perhaps with tomorrow's data the message will begin to sink in that OPECer production cuts are indeed having an impact? Couple that with the colder weather that's due to come back to the eastern half of the country and we may have a set up for some real rebound in crude.