Oil on a 25mth cyclical bull run? Update 3 - oil resumes incline

There may not be a meaningful correction to the stock markets in 2009. Over bought signals indicated that a correction was due, but we didn't get the 10 % or 20 % correction some analysts predicted. As discussed in Q3 stock market rallies 2009 , we may see rallies right into July and August 2009, the market is trading solely on euphoria in once over sold markets, we also have risk appetite back with a vengeance with Goldman Sachs 4 billion profit for the last quarter (q2). So now it's a traders market, with a narrow trading range (indicies) traded on over bought and over sold signal's. As discussed in Stock indices split form the real economy, the outside economy won't have much effect on the stock market at this point in time. The global economy is in a shocking state as far as business/private sector survival goes. But with unemployment and inflation both rising a bigger shock may be the only reason for markets to sell.

As forecasted in Oil on a 25mth cyclical bull run? Update 2 - Oil reaches $70.00 a barrel oil has begun it's 2 year cyclical bull run; reaching a high of $73 June 1st 2009. Trailing stock gains and losses oil is trading more on a reality trip than our currently over speculated stock market. June 1st 2009 the oil price closed at the psychology resistance of $70, with what appeared to be a stock market correction (although it wasn't) on July 13th oil slipped to $58. The OBV showed a divergence on a monthly graph once the psychological resistance level of $70.00 was reached on June 1st 2009; so a sell was inevitable from that point.

Oil is now trading within it's trading range of 58-70 (monthly graph), current close at $61 (15th July 2009). Although with thin volumes indicated that the price could remain static within it's trading range. Buying could test the 70 resistance, like I mentioned earlier in this post the markets are currently in for a major correction at some point, this could occur via a major shock. Either lead on from the commodity markets (oil shock/war/geopolitical/China etc) or a major economic shock such as collapse of derivative market/CDS market/credit market freezes/ commercial property market collapses/UK currency issues/deficit issues/H1N1 - swine flu spread. If stocks late this year, or early 2010 correct (significantly) due to the mentioned possibilities. Oil may diverge away from stock losses.

Click on graph for larger image