British Petroleum (NYSE: BP) and Transocean (NYSE: RIG) have created a bit of a Lehman feel to the markets today. Ironically, oil prices are rocketing. BP has plunged to levels not seen since 1996! Whether or not BP is heading into bankruptcy is immaterial, because Mr. Market certainly thinks so.
As for the market as a whole, while Bernanke spoke to the House Committee, the S&P 500 clawed its way higher, with the emini rising from 1067 to nearly 1078, a 50% recovery of the entire decline from last Friday's peak at 1107.75 to yesterday's low at 1041.25. In and around the 1075 area, we should expect the index to encounter near-term technical selling pressure that stalls the upmove, if nothing else. The shallower the pullback, the more constructive and powerful the developing upmove, with 1070 and then 1064 as key intraday support for containing weakness ahead of a resumption in recovery strength -- if this upmove is real.