Are we ready for minor pullback?

We had unbelievably strong 5 weeks in US market, we are @ all time highs in every major Indices except Russell 2000.

We also had the highest close ever on Friday in DOW, NASDAQ & S&P 500.....

NOW...the logical question is " are we ready for a pause "

To answer that, we want to look @ RSI my preferred technical indicator, they are :

XLF         76.07

S&P 500 70.22

DOW      69.22

Nasdaq   68.49

SOX       67.81

IWM      66.85

Financials are clearly in overbought territory......

S&P 500 also in overbought territory.....

DOW, Nasdaq & SOX are almost in overbought range....

Russell 2000 is lagging, but not by much.....

YES....we are in a " pause area "

We may have couple of days of UP days, then reversal  / pause is not out of question.

Most common strategy is to book profit when any stock hit couple of days of new highs.

OR...you can sit tight and hope that couple of days of pullback is all we are going to get, then party will restart.

I personally think, we are going much higher going into new year...

November remaining 3 weeks may see digestion of huge gains....

I will recommend looking @ " rotation angle " by end of November.....

Expecting December to be a strong month......

Ready or not....a pause in rally may be in store....

Good luck with your own understanding of this TAPE and comfort level.

BLOG does NOT give buy or sell.

Saleem

Posted in: Mixed