Tuesday January 9, 2018
Crude oil advance $1.25 today. But energy and energy service shares did not follow and mostly turned down.Patterson Energy Service was down 3%. Diamond Back FANG was down 2.67%. XES Energy Service was down , came back and closed off for the day.
This is a massive divergence with the oil price up and shares refusing to follow across the board. I suspect the topping process for energy has begun, it got way ahead of itself.
An article on the front page of the WSJ today suggested that investors were now so confident, at DJIA 25,000+,they had ceased buying puts for protection. Surely this crossed the last rubicon of common sense about a market top.
The weakness of energy here suggest that weakness might extend to the larger asset class of stocks in the next week or so.
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