Wednesday, June 1, 2011

Crude Oil (CL) / Russell 2000 (TF) Daily 6/1

Crude oil on the left chart, has fallen off hard after testing the trendline in yellow and just breaking above the 38.2% retracement at 102.35 yesterday. It has nearly engulfed yesterdays move and as long as we finish here I can see this heading back to the 98-97 levels by end of the week. As for equity markets, the Russell 2000 leads the way down today as the divergence pointed out in yesterday's post seems to have come through. Three out of four of the equity indexes that we regularly post about have engulfed at least yesterday's move (nasdaq not quite, but close as it lags behind) and look to erase yesterday. While in earlier posts I had thought a retrace back to channel highs for equities was very possible, yesterday was a surprise, and hopefully it will just be a forgotten memory soon.

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