| Weekly Trend: | Down |
|
| Daily Trend: | Up |
|
| Daily Momentum: | ___ | Up |
The markets are in a highly overbought position. This does not mean that they can’t continue to push higher in the coming weeks. Indeed, the ‘pop’ into new highs during March and April came from this exact position. However, probabilities slowly sway against trades being successful in this type of environment when the market is overbought. During rampant bullish times, such as 2005 – 2007, it’s some what safer to chase momentum. Add to this the current earnings releases in the US and the low volume nature of this rise and I have reason to be cautious. The trend is indecisive; weekly down, daily up. my recommendation here is to play the cards close to your chest and allow the market to offer up a better indication of its intentions.
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