Oil and the DOW

The coming week plans to bring more volatility as more earnings reports roll in. The charts seem to be telling us along with the media that we are overbought and are ripe for a pull back so be on your toes. I don't expect it to be too long a pullback as alot of shorts seemed to be getting squeezed and most will use any opportunity to get out rather than play a long correction.

The one thing I find interesting the most the last 6 months is the corelation with oil prices with the DOW as well as gold with the US dollar. It used to be if the markets went up, oil went down and vice versa but now oil seems to trade up with the DOW rises and vice versa as the market looks for optimism we will be using more oil with a rebound from this recession. My gut tells me OPEC and some others have a very strong interest to keep the price above $50. Funny how new trading trends come out of the blue like that but that's what makes the markets such a wild place to be.

Should be interesting to see how this week plays out with Chrysler and Fiat as any bad news on a big scale could knock us back quickly. Don't see oil going much lower than $45 as the long term prices on the CBOE are showing a long term bias to the upper 50's.

Play safe and don't risk big bucks at this short term top,patience is a virtue for sure at this junction.