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The energy lag and tech technicals: Here’s what could drive markets on Wednesday

As OPEC members are set to convene later this week, WTI crude oil ekes above $50 per barrel and investors pile into bets on the euro, Miller Tabak equity strategist Matt Maley highlights three key themes for Wednesday and the week ahead.

1. The crude oil/energy stocks relationship

Crude oil rose to a five-week high in Tuesday trading as investors await news from this Thursday's meeting of OPEC members. There is optimism around the possibility of member countries extending output cuts, and oil settled up slightly higher at $51.47 per barrel. But Maley is keeping a watchful eye on the relationship between crude oil and the energy equities to which they are closely tethered.

"Crude oil has rallied back above fifty dollars; the problem is energy equities have lagged," he said Tuesday on CNBC's "Trading Nation."

The recent divergence between crude oil and energy stocks, as measured by the XLE energy ETF, gives Maley pause. The XLE is roughly flat over the past month, while crude oil is up by almost 4 percent.

"Energy equities tend to be a leading indicator [for oil], so we want to see this group actually lead oil higher before we get back to it in a major way," he added.

2. Positioning in the euro

Long positions in the euro have become one of the more "crowded" trades, Maley said, pointing to euro futures positioning as measured by Commitments of Traders data. Investors should prepare, he said, for any kind of short-term reversal that may attend such crowding.

"The problem is the positioning in this trade has gotten very extended, and its recent level is usually associated with tops," Maley said.

The euro on Tuesday hit its highest level against the dollar since the U.S. election.

3. Tech stock technicals

The information technology sector is leading the market year to date, and at this point, Maley said, the stocks are overbought on a near-term basis. He will be watching the levels within tech stocks closely, as they've reached levels "that have been associated with near-term tops in the past."

"That doesn't mean that the bull market is over, but it could signal a pullback of about 10 percent or more in the near-term," he said, adding that investors should be prepared for that kind of move lower.

The S&P 500 technology sector has risen more than 18 percent this year.

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