If you look at the weekly index charts you will see that the RSI
is now above 70 and the stochastics are between 97-99 which are the
highest readings since 2007. This is a market that is
overbought - sure it can grind higher but this is not the time to
get complacent with longs.
As of last week, the Market Climate for stocks remained
characterized by strenuous overvaluation, strenuous overbought
conditions, overbullish sentiment, and hostile yield pressures.
True to its short-term form in these conditions, the market pushed
to yet another marginal new high last week. The tendency for the
market to shrug off widely observed overbought conditions may make
it seem that these conditions don't matter. But I can't stress
enough that the pattern of short-term continuation to marginal new
highs is quite typical once the market establishes this syndrome of
conditions, following which
abrupt, nearly vertical
losses are also typical- if unpredictable in timing.
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Comment
Posted by steve on 12th of Apr 2010 at 02:59 pm
If you look at the weekly index charts you will see that the RSI is now above 70 and the stochastics are between 97-99 which are the highest readings since 2007. This is a market that is overbought - sure it can grind higher but this is not the time to get complacent with longs.
Think we have been cautious
Posted by 888888 on 12th of Apr 2010 at 04:04 pm
Think we have been cautious for quite some time now.
LOL
Posted by searay on 12th of Apr 2010 at 04:12 pm
LOL
Hussman's weekly commentaryis in agreement. As
Posted by george_l on 12th of Apr 2010 at 03:34 pm
Hussman's weekly commentaryis in agreement.
As of last week, the Market Climate for stocks remained characterized by strenuous overvaluation, strenuous overbought conditions, overbullish sentiment, and hostile yield pressures. True to its short-term form in these conditions, the market pushed to yet another marginal new high last week. The tendency for the market to shrug off widely observed overbought conditions may make it seem that these conditions don't matter. But I can't stress enough that the pattern of short-term continuation to marginal new highs is quite typical once the market establishes this syndrome of conditions, following which abrupt, nearly vertical losses are also typical- if unpredictable in timing.