How is the turmoil in Egypt affecting the Energy Sector?

The Energy Sector continues to roll with both mid and large-cap names being the top performers in our short and mid-term readings.  And it isn't just big oil that is carrying the sector.  Companies focusing on natural gas have also held their own recently.  And with the turmoil in Egypt, energy prices have been hot just like the stocks in this sector.  This big bounce has the sector overbought, but the sector's long-term relative strength looks good, which you can see in the chart below.

And with our Psychology Composite still at P5, the yellow light is on for the short-term, and you can see the non-confirmation of new highs in the broad market in the chart below.  This is only a short-term yellow light, but it probably means a little pause can be expected to allow the "Wall of Worry" to reinforce itself slightly.

To view today's complete Weekly Sector Report, click here.

Don Hays & Nicholas Warf

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