Oil is moving the market and probably decides in the near term whether stocks hold lows or rally further. Let's take a look.

This is the continuous CL1 contract with long term levels on a weekly chart. You can see the relentless drop after the 2HP and YP break in 2014, and from there is has been a long term downtrend that clearly continued in 2015 2H with the rejection of the 2HP.

But in 2016, oil has tried to hold major support area 1HS1 27.89 and YS1 26.69. Those were near the exact low areas. But if CL closes with a small blue bar above support, that increases the chance of a break in the next bar. Weak buying is just not what you want to see above major support.

Here's the daily view of the same chart. Does not get as crystal clear as that folks! You might even think I'm drawing those levels after the bounce but no, they were in play from the open on 1/4/2016!

Here are quarterly and monthly levels only, without the long term pivots. You can see rejection at the FebP and a lower high recently.

Lastly, CL was able to rally above its WP to WR1 this week (chart not shown) but quickly dropping. Basically, if below the WP next week then probably back down to the major support area to test.

CL1 could form higher low on 1HS1, or even double bottom on the YS1; but anything lower would mean next support near 24.12 and that would probably coincide with a breakdown in the market.

Volume is moving into the J contract, and the levels are: 1HS1 30.77, YS1 29.11, then Q1S2 27.33.