This past weekend I mentioned that some cycles I follow were pointing to a critical time this week for indices, bonds and crude oil. Monday saw the NQ and SP top out at 1916 and the 1390 area with crude oil setting another record, basis the Jun 08 contract, of 11895 on Tuesday (as this is written with less than 45 minutes remaining in the NYMEX day session.)
The sellers stepped in overnight and early Tuesday in the indices, pushing both the SP and NQ back inside their extended ranges mentioned last week with the NQ almost filling the real gap at 1870 from last Friday's session. The close today is critical. Below SP 1389 and NQ 1894 will be a weak sign with confirmation coming from a close at sub-NQ 1867. If this plays out, look for a least a short-term downside target to NQ 1824-1840.
For crude oil, a close below at least 11495 is necessary to slow the upward momentum with a close belwo 11370 signaling a short-term top.
