Some United States stock sector energy-related indices such as the XOI, OSX, XNG, and RPE stand at a crossroads between the commodities related to them and broader equity benchmarks like the S+P 500.

Such relatively narrow energy-related equity estates intersect with the overall United States (and global) economy, not just energy provinces. The energy-related indices also entwine with their “underlying” commodities such as petroleum and natural gas. An equity index vehicle containing corporations involved in the petroleum industry reflects to some extent price levels and bull and bear trends in “underlying” (related) oil prices. These (and other) narrow United States stock sector indices therefore sometimes provide helpful viewpoints for (confirm, reflect) past, current, and future paths for broader stock indices such as the S+P 500 and Dow Jones Industrial Average, as well as for commodities “in general”. Many embrace the broad Goldman Sachs Commodity Index as a worthy indicator for the overall commodity world.

What do these four energy-related equity sectors flag nowadays to S+P 500 and commodity marketplace fans? Given their association (connection) to the broad GSCI (and that their directional walks have been roughly similar to those of the GSCI), and given the GSCI’s failure (so far) to match or venture over its spring 2011 peak, players should monitor closely whether the energy-related stock indices can sustain advances over their spring 2011 heights. Failure to do so would warn of weakness in the broad GSCI. Especially given the proximity of the major resistance levels in the S+P 500 (and that in the DJIA), the inability of these energy-related stock indices to sustain levels well above their springtime 2011 tops would confirm (or at least warn of) a downtrend in the S+P 500 as well.

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Commodity Crossroads- Energy-Related Equity Indices (2-15-13)