Where Crude Will Go From Here

This column was originally published on RealMoney on Jan. 12 at 3:32 p.m. ET. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.

The Dynamic Trading System remains on its buy signal for the S&P 500 (SPX) today but has no positions in the Nasdaq 100 (NDX).

As I write, the SPX is threatening to confirm yesterday's high-volume breakouts on the Nasdaq Composite and the NDX. Closing confirmation would come on a close above 1427 on the SPX, which looks likely at this point in the day.

The SPX had recently been showing poor relative strength (relative to the tech-heavy Nasdaq Composite and NDX), as energy stocks had been holding the SPX down while crude was selling off. However, today, as crude has stabilized, the energy sector, as represented by the Energy Select Sector SPDR (XLE Quote), and the oil-services sector, as represented by Oil Service HOLDRs (OIH Quote), are leading the SPX to the upside. ...