02.21.2012 -- 4 dollar gas and counting..

Oil broke recent highs.. nothing really stopping it now from surging back to 150 again. Except this time, 150 WTI will mean 6-7$ a gallon at the pump.

It's world economies heating up.. yeah thats it.. thats the ticket.

It definitely doesn't have anything to do with trillion dollar deficits, ZIRP and massively increasing FED balance sheets. Nope.. not that.

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Key Levels

Upside -- here to 1370

Downside -- 1351, 1345, 1300, 1294, 1257-1250

A close below 1345 will be short term bearish and will mean a test of 1300 for sure.

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SPX Daily;

Here is our continuing rising bearish wedge.

This thing will break one day. The question is whether we get significant new highs in all indicies before doing so.

Right now, we have a significant new high in the NASDAQ and DOW. However, per DOW theory it is a non-confirmation with the Transports as they have not made a new significant high and actually deteriorated today. Also on the divergence side, the S&P, Russel 2000 and Wilshire have yet to make significant new highs.

It is possible still that we still have one more trip to the bottom of this wedge and yet one more surge to attempt to reach the pinnacle of it. That would work time wise, as we will be entering that late March/April timeframe where sell in May becomes a factor. But the next move down could be it too.. its all going to be how the market trades the next down move.

GL

CJ