Stocks Higher into Final Hour on Another Fall in Energy Prices and Rising Economic Optimism

BOTTOM LINE: The Portfolio is slightly higher into the final hour on gains in my Retail longs, Medical longs and Computer longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is positive as the advance/decline line is higher, most sectors are rising and volume is light. Oil is trading near session lows, down $1.07 to $69.19, notwithstanding the Iranian situation and the potential for hurricanes this month. Barring the formation of a new tropical storm over the holiday weekend, I suspect oil will test its major uptrend line around the 50-week moving-average at $66.30 next week. Overall, commodities continue to weaken. The CRB Index already broke its key uptrend a couple of weeks ago and is now making another weekly lower low. I normally pay some attention to technicals. However, given the fact that a large majority of commodity traders overwhelmingly use technical analysis I am more focused than usual on these key levels. I continue to believe the negative effects oil has had on the U.S. economy and stock market are vastly underestimated. An oil breakdown into the $50s would have hugely positive implications for the broad market. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, more economic optimism, declining energy prices and lower long-term rates.