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What's Next for Stocks?

What's next for stocks? Short-term, oil is still the key. If crude oil remains well north of $100, many traders have been talking about a rangebound market for the next several months. This could get even more problematic as we head toward the end of QE2 (quantitative easing) in June and the loss of that liquidity.

Bear in mind that stocks have weathered this oil storm fairly well. Since oil began its rise on February 21 (the day the S&P hit a multiyear high), it has moved about $18 or 22 percent. Stocks have held up comparatively well: the S&P 500 is down only 2.2 percent in that time period.

One thing's for sure...continued moves up will put pressure on transports, users and manufacturers of plastics (a petroleum byproduct)...and cruise lines. Carnival is down nearly 15 percent in the past two weeks, Royal Caribbean about 10 percent.

Critics will say that this is being offset by the weakness in the dollar — which is true. Partially.

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