Volumes speak volumes as $SPX and crude oil stagger back from Fibonacci resistance

They say price is the ultimate indicator. But volumes help you interpret what price is saying, too. Fibonacci price levels were recently tested as resistance in both the stock market and crude oil. The S&P 500 ($SPX) tested at 1290/1292, the 70.7% retrace to 1370 (and earlier this year when 1370 was testing by vaulting over the 61.8%-to-70.7% retrace to 2007's peak, then dropping back). Crude oil just tested at $103, the 70.7% retrace to the almost $115 high earlier this year, which was itself the 70.7% retrace to its prior excruciating peak about $148. Most of these price levels I've marked on these particular samples of my charts, below - daily and monthly charts of $SPX and $WTIC.

So check out the volumes on these charts. On the daily charts, volumes increased on the drops from this year's earlier highs, and again picked up during the recent drops. And there were rather high volumes on the initial drops off the peaks several years ago. When volumes on drops are higher than volumes on price increases, that's bearish. Indicators like the StochRSI incorporate this into their formulas and accordingly we see these indicators reflecting rather bearish signs.

Still, the $SPX is almost down to a level the tests the lower trendline of a potential rising price channel I marked on the daily chart. I marked it about a week ago because I didn't want to assume the bearish case too soon. Since the stock market is oversold, it could use this, plus the 50-day moving average, as a place to stage a rally effort. And crude oil could make a similar move - consolidate or bounce at least some - probably from a slightly lower level, perhaps tomorrow.

So a good bounce toward the Thanksgiving holiday late this week would be fine. Just keep an eye on volumes (and the indicators they drive). Because they could signal that the bearish case may retake the stronger hand.