ENERGY STOCKS RALLY AS CRUDE HITS $100 -- DEVON AND EOG JOIN NATURAL GAS LEADERS -- GOLD STOCKS ARE TRIANGULATING IN UPTREND -- COMMODITIES HAVE ANOTHER BIG DAY -- STOCK RALLY FADES

MORE NATURAL GAS BREAKOUTS ... Last Tuesday, I wrote about new energy leadership coming from natural gas stocks. I showed two natural gas stocks that were hitting new record highs, including Chesapeake and XTO Energy. Both are hitting new records again today. Here are a couple more natural gas stocks to add to the new high list. Devon Energy (Chart 1) and EOG Resources (Chart 2) have broken through their recent highs to achieve new records. Their rising relative strength lines testify to their market leadership. Energy stocks in general were the day's strongest group thanks to a nearly $4.00 jump in the price of crude which touched the $100 milestone once again. Basic material stocks also gained on another strong day in commodity markets. Gold stocks rose more than 4% and were the day's strongest group. Gold itself rose $23 and is nearing a record. The CRB Index jumped more than 10 points to a new record. The buying spree in commodity markets continues.

Chart 1

Chart 2

GOLD STOCKS IN BULLISH TRIANGLE ... Last week, I wrote about the Nasdaq forming an apparent bearish "symmetrical triangle". That's the bad news. The good news is that the Market Vectors Gold Miners ETF appears to forming a bullish triangle. That's identified by the two converging trendlines shown in Chart 3. Since the prior trend in gold stocks was up, technical odds favor an eventual upside breakout. The fact that gold prices are near a record high is also helping the GDX. Unfortunately, it's not a good sign for the rest of the market when gold and energy shares are its strongest groups.

Chart 3

MARKET'S TREND IS STILL DOWN... A morning rally faded by day's end. By the close, the Dow was down 10 points. Chart 4 shows the Dow still trading well below its early February peak and its 50-day moving average. It would have to clear both of those resistance barriers to improve its short-term trend. It didn't even come close to doing that today. In reality, the day's losses were even worse than they looked on the surface. The only big gainers were commodity related stocks on the backs of big rallies in commodities. Gold and energy shares had big days. Unfortunately, most other groups were down. Some of the biggest losers were in financials, retailers, and technology. It's hard to imagine how crude oil hitting $100 can be good for the stock market or the economy.

Chart 4