Energy stocks had every reason to fall apart.
A huge bearish momentum divergence turned up at the end of last year, at the same time prices were running into 15-year resistance levels. The global economic outlook weakened, pointing toward lower demand for commodities. Oil prices fell to $65, less than half of last year’s peak levels.
Instead of a major selloff, though, Energy seems determined to work off that bearish momentum divergence with time, rather than price. The sector is stubbornly hanging near those former peaks.
The bears have lost control.