The next reversal zone for the broad stock market is coming up April 9 - 17. If the DOW can now rally above last week's high of 26,109, it looks like we could end up with another high in that time frame and probably see the final top of the current medium-term cycle. That would be a good opportunity for a short sell. But note that any short selling from a top in this next reversal zone (if we get a top) would be a short-term trade to take advantage of what is usually a brief but steep correction to a final cycle bottom. On the other hand, if next week the DOW breaks below last week's low of 25,372 then we should expect a low in that mid-April reversal zone. So these are two lines to watch next week to tell us the directional trend into mid April. Another level to watch is 25,208. Any break below there would be very bearish with the market pointed down for possibly many more weeks. In that scenario, we would be waiting for the final bottom to the medium-term cycle to buy. I still think we could have another strong rally from that bottom into the summer that could easily make new highs and possibly even be a "blow-off" top before the start of a very severe correction into next year. I am favoring a break to the upside next week so stay tuned as we may be buying any short-term dip that stays above last week's low (25,372). On the sidelines of the broad stock market for now.
Crude oil prices made a new monthly high last week. That was not in a reversal zone, but prices could still turn down here as a sub-cycle high is due (overdue), and it would be nice to see crude fall from last week's high ($60.73 - May contract chart) or perhaps from another high this week into that April 9 - 17 reversal (which is relevant to crude) and form a sub-cycle low to buy. A good price target to buy would still be in the $55 -$56 range. If equity markets rally next week, crude may follow suit and push higher into the early part of the reversal zone. In that case we may have to wait a bit longer for a corrective low to buy. We are still bullish on crude through the rest of this year. Still on the sidelines and waiting to go long.