Technical Analysis of Financial Markets

Wednesday, August 16, 2006

AMEX Oil Index (XOI) - Negative Divergence

During early Sep and late Oct 2005, the MACD indictor formed a negative divergence against price action for nearly 2 months; subsequently the AMEX Oil Index plunged. The same negative divergence of MACD against price action on a similar 2 month scale is currently in progress beginning early July 2006. A break of support at 1180/1160 may signal a move lower on a similar scale as during Oct 2005 bringing price action down to the lower end of the trading range; oil stocks may be poised to fall.


Anonymous said...

nice call...

the energy plays have been looking weak lately even as oil approached new highs.

Anonymous said...


What do you think about NVidia as a short here. I just noticed that insiders CEO/CFO sold 50-60% of their holdings......and it is looking like it may pull back again.
What do you think?