People are jumping on the band wagon today because unemployment numbers came in better than expected. This is short lived and the support levels I discussed seem to be on track. 1035 is lowest this market can go without causing panic. The S&P could trade between 1045-1065 over the next few weeks. The DOW is trading properly and should be around the low 10,000 level. With stocks getting beat up expect more announcements for M&A. It was mentioned earlier this week that M&A has picked up from a 2 year drought. Typically after a recession companies get swallowed up or go out of business. The thing is did we ever leave the first recession?

Oil has been having a very tough time of breaking this $82.50 resistance level as the market has come down to $81 after the weak jobs report Friday.  Ben Bernanke speaking tomorrow will be huge to this market and it is either a big rally or big drop for the black Gold.  If traders like what he has to say Oil will for sure test the $82.50 level, but if not the market can quickly get liquidated to below $80.  It is a very interesting day tomorrow.

The Oil spill off the gulf of Mexico that BP is to blame for has now surpassed the 8 week mark and there seems like nothing will stop this enormous catastrophe as there have been mant attempts at fixing the damaged hole but to no avail yet.  This hasn’t had too much of an aeffect on the market however the WTI spreads rallied 50 cents in two days last week as there were reports of delaying oil tanker permits from coming in to the gulf bc of the messy seas. Crude now sits at $75 but if this continues to leak then there could be major problems ahead for the oil markets.

http://www.washingtonpost.com/wp-dyn/content/article/2010/05/21/AR2010052101854.html

Crude Oil has now gotten to the illustrious $70/barrel level as the debt concerns in Europe worsen.  It seems as the WTI spreads have finally lead the market lower as the Jun/Dec spread continues to liquidate trading down to -1200 at one point.  Technically this market has a nice support level at $70 from 6 months ago but right now with the USD gaining momentum and supplies still increasing, this barrier may be broken very soon.

Crude Oil finally liquidated to $75 on the back of a plunging equity market and the trouble going on in Europe.  WTI spreads were the first key indicator as spreads started to get very weak 3 weeks agio as supplies continued to rise in cushing.  I believe that this $75 mark is a very big support area and Crude will bounce off this as traders start taking profits on the 13% slide.  The VIX has increased every day and this is good for the day trader as you can probably see swings of $2 or more every day in the energy market.

It  has been an interesting week her on the NYMEX as the flatprice in crude has rallied to new highs at $87 but the wti spreads have weakened considerably especially in the front months as now May/June and June/July have a handle of -63 on it now.  Jun/Dec has weakend all the way from -130 to -230.  The backs are holding up well with Dec10/Dec11 trading at -135 but this has also come down from -90.  Is this a sign that the flatprice will come off in the next few days?  It may be a sign but just wait and see what happens on Wednesdays inventroy report.

Crude Oil is making new highs here on the NYMEX for 2010 and this should not go unnoticed with the WTI spreads rallying along with the flatprice.  The spreads rally, especially in the back with Jun/Dec  to -170 and Dec/Red to -160 has had a positive affect on the upside for the oil markets.  Right now $83.60 does not look far out of the reach here and if these spreads keep rallying flat price will keep climbing.

SBK: Res. 2233-37, 2288, 2322, Sup 2162, 2140-2123, 2090

KCK: Res. 13130, 13285, 13390, Sup. 12970, 12860-25

CCK: Res. 2889, 2903, 2946-55, Sup. 2811, 2799-2795, 2760

CTK: Res. 8309, 8449-75, Sup. 8176, 8095-8075, 8000

6 more weeks of misery is what I need. Thanks Phil.