I am extremely worried that US stock market may correct sharply starting very soon. Reasons are many but the biggest reason may surprise many.
Let us look @ my worry index, there are many i follow, none fundamental but all technical, they are in danger zone......
RSI.........
Nasdaq.............69.91
S&P 500. 72.39
SOX................75.42
Dow................78.64
These numbers are downright bearish....
RSI @ 60 bearish / overbought........RSI @ 30 bullish / oversold
Bull / bear ratio.......
Bull 60.4%
Bear 15.1%
Again bull @ 60% bearish / overbought near high of its range, bear @ 15.1% is near lows of its range clearly flashing bearish signal
SOX UP for 3 straight week.......extremely overbought
Dow @ 5 weeks high......extremely overbought
Nasdaq 3 weeks UP move....overbought
S&P 500 2 weeks UP move.....
Lastly, my own monitoring tool, there is no fear anywhere, everybody is very comfortable with this TAPE and ignoring all overbought signals......popular theme in these situation is " its different this time "......that is a tell tale of imminent correction each time......
SO...i decided to listen to my inner voice and Sold 40.87% of my current holdings AH on Friday..my before sale exposure was 20% lower than my usual position.......based on my normal exposure, currently i am @ 39% exposure......i may reduce it further on Monday...
All i can say, be very careful, nothing goes UP in straight line ever.....we are sitting @ decades high, means sharp pullback highly probable.....
In these situation, being wrong is not such a bad thing.......
Good luck with your own comfort level and your own take of this TAPE....
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hi Stocktrader,
Sold CTRP @ $55.53.
Saleem
Hi Saleem,
Good luck with the profit taking moves.
Stocktrader
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