I had to go back and double check, but the target from that triangle breakout a couple of weeks ago should put the SP500 at 2950-3000. That's still about 10% above, but it is possible. I've noticed that the corrections since the April lows have narrowed. That first consolidation on the SP500 from Mid-April to end of April had a drop of -100pts. The second consolidation occurred in May and only had a drop of -50pts. I still feel like we should see another consolidation soon, but it shouldn't fall more than the 50 points from the last one. It's just a theory, but if it holds true, then buying the SP500 when it finally breaks above 2800 should give a low risk return.
As for oil, it's bouncing nicely off that 100-day ma, but I read an article in one of the modern trader magazine where the author provided details of oil chart patterns. Oil tends to rally from Feb-May/June, and then sells off between July into October before consolidating and then rallying again. During bullish years, the rally is higher than the sell off, and during bearish years, the selloff is steeper than the rally back up. I was going off this pattern when I started buying oil stocks back in March and April. I only bought the stocks that broke out of patterns too. If you look at HES, COP, and PSX, they were all breaking out of bases when I jumped into those trades. There were a couple more smaller cap stocks, but with so many of the larger cap breaking out, I stayed with the most liquid stocks. I wouldn't be surprised if oil tested $73 again by July. In fact, if I remember correctly in 2007, oil rallied right through the Summer months. That might have been the only time in the past decade or so that oil rallied through the Summer months.
