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The chart above reflects that Crude Oil and the S&P 500 have been moving in Sync for the past couple of years (hitting highs and lows very close to the same time). Crude Oil has been contained by this multi-year flag pattern and each time its hit the top of the flag pattern Crude and the 500 index have taken a pause.
Crude Oil is now nearing the top of the flag pattern. Does Crude need to break this pattern, on its way up to $100 per barrel for the 500 index to break above its 2007 highs?
The 500 index has benefited from higher Crude oil and odds are high a breakout of Crude would be beneficial for the broad market.
Stay tuned to see “if its different this time!”