Since the last post, the stock market shot up higher after consolidating for several weeks. The break above SP500 1900 was finally completed and the indexes had a nice week long rally. I thought the move higher could be done early last week but then on that Thursday started another move higher for three more days before pausing or pulling back slightly. So this week my indicators are now at short and medium term overbought thus this warrant caution at minimum as individual stocks could be hit with some selling before the indexes. Now comes the new record concerning the SP500 200 day moving average. Going back the past +25 years, the longest the SP500 have been above its 200 DMA without retouching it has been 18.5 months. Currently it's about a week away from 19 months and the SP500 is still +7% above the 200 DMA at 1808. Is it different this time? In Wall Street, that's a dangerous question to ask. Stock market appears resilient and the truth is we are still in a long term secular bull market. But eventually I believe the SP500 will meet the 200 DMA some where between current level of mid 1900s to the lower level of the 1850s.
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