Pop and Drop

The stock market attempted to Spike higher but was quickly faded. Breadth continues to be poor and the Small Cap sector is taking a fair amount of individual hits. Oil was down noticeably earlier in the day but rebounded and held the $63 support level. We recently predicted this price action in Oil in a post we published yesterday.

The Bulls who were so stubbornly charging forward the last few months are now acting stubborn in their anti-buying campaign. In other words, it's not that there are a tremendous amount of sellers (which is indicative of the light volume) rather the buyers are M.I.A.

Perhaps now Oil has found some support from its recent slippery slide and will resume its accent towards $70. This might be all that is needed to create a more capitulatory sell off in the stock market.

We remain cautious.

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