Are we getting overbought ?

Indices have come a long way since low point in 3rd week of June.....

Nasdaq has moved UP from 4574.25 to 5232.90, a move of 658.65 points or 14.40% in a short span of 8 weeks...

Here is the RSI comparison :

Dow 61.82

S&P 500 @ 62.77

Nasdaq 68.90

Bullish sentiment is @ the highest level in a very long time, currently @ 54.2% and bears only 20%....

VIX @ 11.55% ...52 wk low is 11.02

All of the above "fast & furious UP move " is flashing warning sign......

There is a need to pay attention to this "overbought scenario"

It is good idea to book profit where RSI is hitting 70 area and buy those sectors which are lagging like energy, gas & base metals......

This TAPE has been very good for most of us, thus it is important not to be complacent.

It is also a good idea to reduce exposure until we get some kind of correction.

VIX RSI are generally good in flashing warning signs......

A gradual booking of profit is highly desirable.

Earnings are mostly out of the way, thus a major catalyst is gone.

Next 3 weeks may be on the down side......

Good luck with your own strategy and analysis.

BLOG does NOT give buy or sell.

Saleem

Posted in: Mixed