Very telling was the final 15 minutes of the S&P Futures. After closing regular trading hours at 1364, they fell during the 15-minute after-session to 1362.75, just above the lows of the day. Anybody who has been watching this market over the course of this rally will tell you that this was unusual, if not downright unique. Throughout this perma-Bull rally, the Futures consistently have ended trading on a positive note, even if only due to the usual final-trade short covering spike. Some were desperate to get out of their longs even at a loss, considering that the Futures closed just above their lows of the day of 1361.50. That is not a good omen for market events next week.
And, if you don't have faith in the Transports, the DJ Utilities are showing the same Bearish divergence. Funny thing about divergences, especially ones as glaring as these, is that they usually close, with the laggard catching up to the leader. I stand by my belief that a correction is coming, and soon.
Everybody is talking about the rise in oil prices. It is usually accepted that a small increase in oil prices helps the market, by lifting the myriad energy and energy-related stocks. But once the increase in oil prices gets out of hand, the whole market gets clobbered. Oil ($CL_F) was approaching 110 today. With a market just begging for a real correction, a further move higher in oil prices could help set that in motion.
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