Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

IS OIL FLASHING A WARNING FOR STOCKS AGAIN?

Note in the charts below how oil has recently begun pullbacks before stocks.

CRUDE OIL DAILY AVAFX CHART 03 FEB 26

S&P 500 DAILY AVAFX CHART 02 FEB 26

NOTE: Oil often moves down before stocks. As the charts above illustrate, oil began its pullback January 12th, more than a week before the S&P began to fall on January 20th. Then too, both were at near term highs. Be warned.

Crude Oil: Futures currently at $78.05 little changed from Wednesday's $ 78.33 in early European trade Friday, moving down as stocks stick to tight range. NOTE: Oil often moves down before stocks, as began is pullback January 12th, more than a week before the S&P began to fall on January 20th. Then too, both were at near term highs.

Recommendations Unchanged:

Long: Enter after successful retest/bounce off of the 23.6% Fib level around $75.23 level with stop loss just below it. The $80/84 range has been solid resistance over the past year. Barring great news about global recovery, longs are dangerous at this level.

Short: with possible support from the 50 day SMA around $77.30, then the 23.6% level, then at the 200 day SMA just below around $73.30, then support at the 38.2% Fib level conservative multi-day traders should wait, no until we have clarification of the trend. No compelling short entry points at this time, Best to hope for a test of $84 that fails, which would then give us some good downside room. Note that oil has needed a lot of optimism to get above $80 over the past year. We don't have that with uncertainty from the EU, so those willing to take a bit more risk can try small short position entries if oil starts to reverse at current levels, with targets to the support levels mentioned above. Until some major new clarification, oil could just range trade around.

As with all trades, watch the S&P 500 Futures or other major stock index for overall view of risk appetite, and also the EURUSD for a picture of risk currency sentiment. Again, the key news now is about progress or lack thereof, on the EU debt crisis.

DISCLOSURE: NO POSITIONS