Commodities have been moving higher with the broad equity markets over the last two months in a sympathetic bet that economic growth will stabilize and resume its upward trajectory later this year and into 2010. But most of those futures markets now look tired and stretched, raising doubts about the resilience of buying interest in the months ahead. Still, it's unlikely all commodities will trade in lock step as we head into the warmer months of the year. Specifically, the gold and silver complexes are dancing to the beat of a different drummer these days and could be headed substantially higher through the summertime. I'll focus on trading opportunities in those groups later in this column. Commodity-related equities are especially risky going forward because they respond to the vagaries of the futures markets as well as the tug and pull of the broader indices. A selloff in the S&P 500 and Dow Industrials concurrent with a futures downturn would have a dramatic effect on these stocks, because they would lose both sources of uptrend support.
Oil Services HOLDRs -- Daily
Nowhere is this risk more acute than in the oil services sector, which has taken off like a rocket since the Oil Services HOLDRs ( OIH) ETF broke out of a five-month basing pattern in April. That instrument has risen more than 20% in the last three weeks but has now hit major resistance at the 200-day moving average, as well as October and November swing highs.