The rebound rally in the crude oil at the start of the week not only helped the futures market, but it also helped drive the Dow Jones Industrial Average and S&P 500 Index into fresh all-time highs. With oil at its highest level since the week-ending December 4, it seems like a good time to revisit the S&P Energy Select SPDR ETF (XLE) and Exxon Mobil Corporation (XOM).
The last time I covered these two equity markets was the week-ending February 25. At that time, crude oil was building its support base and the stock market had just reached its low for the year.
At that time, I wrote the following:
“We have a few interesting divergences developing between oil-related stocks and crude oil prices. This may mean that investors are realizing that the oil companies may have reached key value areas, and that they are finally getting a grasp on the impact of lower crude oil prices on their company’s bottom-line.”
“In these cases, you can see that the stocks or the ETF did not follow crude oil prices lower during its current sell-off. This could be a sign that buyers are coming in to support these equities or that the selling pressure is subsiding. I can’t identify a buy signal yet but the price action suggests that the XLE (S&P Energy Select Sector SPDR Fund), XOM (Exxon Mobil) and CVX (Chevron Corporation) should be on your investment radar. “
Since that time, improving fundamentals in the oil market and…