June 23, 2017

Market Continues to Muddle in Overbought Territory

Nineteen out of the last twenty-one years have seen a rise in the S&P 500 during the first fur trading days in April. What does that mean? Well, that means that tomorrow should be the last of the short-term bullish sentiment (at least over the short-term). Moreover, the fact that the major indices have once again pushed into a short-term ‘overbought’ state means that the probability of a decline increases even further.

My feeling is that the S&P 500 has maxed out its gains over the short to intermediate-term and should push back, at least to the gap from 3/5. More specifically, a move to the $112.34 in the S&P 500 (SPY) or $45.76 in the NASDAQ 100 (QQQQ).

I hope all of you have a wonderful night. Enjoy the game!

Kindest,

Andy

Overbought-Oversold levels for April 5, 2010

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 81.7 (very overbought)
* Dow Jones (DIA) – 77.8 (overbought)
* Russell 2000 (IWM) – 75.5 (overbought)
* NASDAQ 100 (QQQQ) – 76.7 (overbought)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 65.4 (neutral)
* Consumer Discretionary (XLY) – 79.3 (overbought)
* Health Care (XLV) – 51.7 (neutral)
* Financial (XLF) – 84.4 (very overbought)
* Energy (XLE) – 83.3 (very overbought)
* Industrial (XLI) – 79.2 (overbought)
* Materials (XLB) – 78.2 (overbought)
* Real Estate (IYR) – 76.5 (overbought)
* Retail (RTH) – 69.2 (neutral)
* Utilities (XLU) – 74.5 (overbought)

Ultra Extremes

* Ultra Long (SSO) – 81.9 (very overbought)
* Ultra Short (SDS) – 17.2 (very oversold)