Indexes Overbought?

D

Div Poacher

If you examine charts of the S&P or Dow, versus a short moving average or an envelope channel, things sure look overbought from a short term perspective.

Even last year's rally from the October low "regressed to the mean" a few days after the biggest climbs.

So I suspect the "war rally" is more than priced in. After all, 10% in six days is a pretty good move. I think we'll see DOW 8050 or S&P 860 (intraday) sometime soon.
 
Quote from Div Poacher:

If you examine charts of the S&P or Dow, versus a short moving average or an envelope channel, things sure look overbought from a short term perspective.

Even last year's rally from the October low "regressed to the mean" a few days after the biggest climbs.

So I suspect the "war rally" is more than priced in. After all, 10% in six days is a pretty good move. I think we'll see DOW 8050 or S&P 860 (intraday) sometime soon.
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Wow!! You think we may see a major 1-2% correction in the next few days!:)
 
Well, I'm conservative in assessing a counter-move. I wouldn't expect such a strong uptrend to drop below it's moving average.

But I have to wonder what kind of expectation buyers have had the last 48 hours. Another 10% in six days? Yeah, right..
 
I agree, but I do not even need technicals to tell me that the rally is shortlived and is just making up for the lack of volatility because of the war uncertainty.

Market is still overvalued, the real estate/mortgage bubble will soon burst, consumer debt is through the roof, bankruptcies are at the highest level, while the job market is pure shit. Outside of prining more paper, eroding the dollar and artifically creating more consumption with more debt, there is nothing to turn this economy around. Although oil at $10 a barrel could help.

Government has high debt, many local governments are in a budget crisis, trade deficit is at a high (although it can be argued how pointless that number really is).

So get those shorts in
 
Quote from Mecro:

I agree, but I do not even need technicals to tell me that the rally is shortlived and is just making up for the lack of volatility because of the war uncertainty.

Market is still overvalued, the real estate/mortgage bubble will soon burst, consumer debt is through the roof, bankruptcies are at the highest level, while the job market is pure shit. Outside of prining more paper, eroding the dollar and artifically creating more consumption with more debt, there is nothing to turn this economy around. Although oil at $10 a barrel could help.

Government has high debt, many local governments are in a budget crisis, trade deficit is at a high (although it can be argued how pointless that number really is).

So get those shorts in
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All well and good. But what does that have to do with where equities are headed?
 
"Market is still overvalued"

AND

"So get those shorts in"

Should tell you where the equities are headed unless you can think of any reason why the market should go up, cause I certaintly cannot.
 
I think the indexes, or indicies, are overbought also but that doesn't mean it won't become more so. I think we rally through the close on friday and take a dump on monday.
 
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