Implications of A Looming End to Overbought Conditions – The Market Breadth

Implications of A Looming End to Overbought Conditions – The Market Breadth

Stock Market Commentary Just one day after stocks narrowly avoided bearish conditions, a looming end to this extended overbought rally brought the stock market right back to the edge. Market breadth is at its lowest point since the overbought period began over a month ago. This tension means that the market may become less willing … Read more

Stocks Narrowly Avoid Bearish Conditions – The Market Breadth

Stocks Narrowly Avoid Bearish Conditions - The Market Breadth

Stock Market Commentary Last month, the stock market seemed to conclude that the threat of inflation had all but disappeared. Given the resulting celebration is one of the key drivers of the current extended overbought rally, today’s report on December’s CPI (Consumer Price Index) took on some significance. So when CPI missed “expectations” on the … Read more

Overbought Conditions In Peril As New Year Weakness Continues – The Market Breadth

Overbought Conditions Continue Despite On-Going Weakness - The Market Breadth

Stock Market Commentary As new year weakness continues in the stock market, a serious tension has emerged in the message of the market between profit-taking versus a sustained top. An extended overbought period raises the stakes for the resolution of this tension. As long as the stock market remains overbought, I will assume the current … Read more

Profit-Taking Or A Top? An Overbought Market Roundtrips – The Market Breadth

Profit-Taking Or A Top - An Overbought Market Roundtrips – The Market Breadth

Stock Market Commentary Exactly two weeks ago, the stock market fell out of bed. I called the abrupt move the rally’s third strike. However, buyers jumped right back into the fray and overcame that third strike with a rally right to the second to last trading day of the year. So far, the new year … Read more

A Remarkable Year Ends With Signature Stock Market Moments – The Market Breadth

A Remarkable Year Ends With Signature Stock Market Moments - The Market Breadth

Stock Market Commentary Signature stock market moments capped a remarkable year for the stock market. Two months of nearly relentless buying delivered a stunning 70% of the gains for the S&P 500 in 2023 after bulls exploded out of oversold trading conditions. Housing-related stocks soared even more as financial markets celebrate the presumed end of … Read more

The Extended Overbought Rally Quickly Overcomes Its Third Strike – The Market Breadth

Extended Overbought Rally Quickly Overcomes Third Strike – The Market Breadth

Stock Market Commentary After the stock market rally suffered strike one and strike two, Wednesday’s sudden pullback had all the signatures of a third strike to start the end of the extended overbought rally. Sellers surged in the final 90 minutes of trading that day. However, they failed to sustain the stampede for the exits. … Read more

An Appreciating Yen Is the Rally’s Second Strike – The Market Breadth

first strike against the rally

Stock Market Commentary Technical underpinnings are changing fast in the stock market. The first strike against the rally came in the form of initial struggles to break into overbought territory. A second strike has now emerged in the form of an appreciating Japanese yen (FXY). To the extent carry trades – borrowing cheap yen to … Read more

Buyers Get A Hit and Dash Into Overbought Conditions – The Market Breadth

Buyers Get A Hit and Dash Into Overbought Conditions

Stock Market Commentary Market breadth tentatively tested the overbought threshold before buyers got a hit and made a dash into overbought conditions. The previous tentativeness created a first strike against the market rally. The dash into overbought conditions refreshed a broad bullishness in the stock market. Long-term interest rates were once again the center of … Read more

Little Time to Rest for the Oversold Bounce – The Market Breadth

little time to rest (Credit: animal-tigers-running-wallpaper-3 by Farmington Strength on Flickr)

Stock Market Commentary Downtrends are over. Bullish breakouts abound. Sellers got one chance last week to try to keep the cork in the bottle of the oversold bounce, but they failed. The stock market insisted on pushing right through. With little time to rest, the S&P 500 and the NASDAQ ended the week with major … Read more

A Major Reset As Market Breadth Goes Parabolic – The Market Breadth

AT50 (MMFI) skyrocketed and reached its highest close since August.

Stock Market Commentary An October jobs report with some weakening numbers and more downward revisions of prior numbers appeared to reinforce the market’s celebratory conclusion that the Fed is done hiking interest rates. The resulting drop in long-term interest rates helped to support a major reset for the stock market. October’s bearishness has given way … Read more