View From The Hill (Dec-23-2015): Crude Oil Leading the Market

Posted on Posted in Views From The Hill

Commentary

bulls-and-bears4

With bulls putting together three back-to-back wins, a rally is in play. Santa’s early arrival has really stuffed it to the shorts . The flat Durable Goods report November-2015 (actual new orders @ 0.0%) had no bearing (pun unintended) on today’s session.

Had someone told me a month ago that Crude Oil would be leading this market, I would have suggested a psychiatric evaluation. The overall fundamentals for oil remain weak, but the bearish energy report that I and many others anticipated failed to materialize as the EIA reported a 5.9mm barrel drawdown vs.  consensus forecasts @ 600k surplus. With WTI Crude up almost four percent, it was more than enough to lift the CRB Index to second place in performance. Both Gold and Bonds suffered from rising 10 and 30 year treasury rates. The Dollar barely budged and Real Estate assets delivered mixed results.

Stocks derived today’s positive performance primarily from the energy markets. All the major equity indexes in our performance universe were up. Leading sectors were Energy (XLE +4.35%) and Materials (XLB +2.36%).  Telecom (IYX +2.18%) which continues to attract investors, was accompanied by Utilities (XLU +2.18%), There were no losers today, but Consumer Discretionary (XLY +0.51) (despite December-2015’s rising Consumer Sentiment Index @ 92.5 or November-2015’s solid Personal Income and Spending) and Information Technology (VGT +0.51%) significantly lagged.

Double-digit performances in individual stocks were noted among energy and materials companies, e.g. Freeport-McMoRan (FCX +16.04% on 101% volume surge), Williams Cos (WMB +12.27% on 166% volume surge), Devon Energy (DVN +11.30% on 70% volume surge). Another biotech also joined the volume radar list, i.e. Celgene (CELG +9.83% on 196% volume surge).

Consumer stocks produced some of today’s biggest losers as Bed Bath & Beyond (BBBY -4.58% on 241% volume surge) and Nike (NKE -2.38% on 520% volume surge) just couldn’t do it today.

No further comments…

 


Performance Summary

*Trends: ST = short-term; MT = Intermediate-term; LT = long-term

vfth-performance-12023-2015
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Market Condition

christmas-relaxingThe lack of higher volume for advancing issues is still somewhat bothersome but given that this is a seasonally slow time of the year, the market is being a given a pass and only too happy to take a win where and when it can.  Most encouraging, however, was the SP-500’s clearing of resistance @ 2060, closing above its 50 day moving average and crossing into positive momentum territory for the 20 and 50 day averages.

The next walls of worry for the market to surmount are the existing downtrend line which bears (again no pun intended) upon it and resistance @ 2076-2080. Support is @ 2045-2040 levels.

Hillbent on the Market Direction…

 

Daily Chart Technical Analysis
sp500-daily-12-23-2015
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Market Breadth
Advancers 465 Decliners 36
New 5-day highs 202 New 5-day lows 13
New 52-week highs 15 New 52-week lows 23
Bullish reversals 15 Bearish reversals 22

 

Market Momentum
% > 20 M.A. % > 50 M.A. % > 100 M.A. % > 200 M.A.
57% ↑ 52% ↑
50%
45%
↑ = positive momentum; ↓ = negative momentum; and ↔ = neutral momentum

 


Volume Radar Alerts

  • Vol % = volume percentage greater than average volume
  • SIR = short interest ratio or days to cover
vfth-volume-radar-12-23-2015
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Disclaimer

Hillbent does not provide individualized market advice. The information we publish regards securities in which we believe our readers may be interested and our reports reflect our sincere opinions. Nevertheless, they are not intended to be personalized recommendations to buy, hold, or sell securities. Investments in the securities markets, and especially in options, are speculative and involve substantial risk. Each individual investor should determine their respective appropriate level of risk. It is recommended that you seek personal advice from your professional investment advisor and conduct further independent due diligence research before acting on information published in any of our reports. Most of our information is derived directly from information published by the companies on which we report and/or from other sources we deem to be reliable, without our independent verification. Therefore, we cannot assure the completeness or accuracy of information contained within these reports and we do not in any way warrant or guarantee the success of any action which you take in reliance on our statements. Hillbent.com, Inc. or its affiliates may own positions in the equities mentioned in our reports. We do not receive any compensation from any of the companies covered in our reports.

 

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