Sentiment has grown hot now that everyone's seeing the markets already exceeding or in some cases about to exceed their April highs. This is reflecting in the put-call ratio ($CPCE for the equity-only put-call ratio) and the volatility index ($VIX). Below are daily and weekly charts of both. I read them as reaching extremes and in the case of $VIX, at or very near support levels as I've marked and in terms of Bollinger Bands on both the daily and weekly charts. Not that a stock market reversal would be immediate. Often a more significant reversal occurs once these indicators have retested extremes at a lesser level. But these are warning that a turn is rather close.
I've also added two charts showing the percent of NYSE ($NYA) and Nasdaq stocks that are above their 50-day moving averages. Not that these are purely sentiment indicators but they do reflect a very bullish outlook when they're rising. Since both are at overbought levels, this adds to the warning. I've also added to each of those charts, as a lower window indicator, the McClellan Oscillator. In each case it's rising but to a lower high which is one of the negative divergences showing that breadth and strength are waning in this upwave.
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