The S&P 500 short-term model is not quite overbought but is close. The Nasdaq model is clearly overbought, and it tends to generate fewer signals, so I pay attention to it when it does register.
In short, I am recommending exiting the current SSO trade with a market order before the close today. I will use the current price of 25.96 for the exit for a little better than 2% gain.
Pete
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I didn't want the previous post to take too long, but I thought I'd suggest checking out http://sentimentrader.blogspot.com/
ReplyDeletefor the latest comment regarding the TICK data.
Looking back at the previous instances comparable to this one, the market was near the highs (and stalling range) of significant rallies with much more downside risk that upside potential.
While I actually expect new highs in this case, given everything I've covered in recent weeks, we definitely can assume there is much greater downside risk than upside potential on an intermediate term time frame.
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