Zweig Breadth Thrust dropped down to 59.51 today and so this is now out of the overbought zone, though I don’t think it really matters all that much given that just about all the other breadth indicators that I follow ticked up today.
$NYHILO rose to 90.09 today. It’s probably got a little more room to go on the upside, but this is now flashing red flags.
$NYSI hit 1270 today and is pushing deeper into the land of overboughtness.
But here’s the bottom line: While the markets are overbought and getting more so by the day, the trend must be respected. Period. IMHO, this rally is running out of time but it clearly has not run out of time. The market could fool me, and it won’t be the first time, and continue on higher into 2013. Until there is some kind of clear signal that the market, try as it might, can not go higher, then longs remain in the driver’s seat.
Daily chart of $SPX showing a healthy index moving higher and higher. I expected a pause day today so the indecision doji should be no surprise. The most troubling thing I see on the chart is the RSI at 73. There are plenty of charting sites out there that would have the 70 line marked with “Sell,” if you catch my drift.
We’re going to need some time to see how the market’s overboughtness shakes out. In the meantime, be careful.