{"id":39099,"date":"2017-04-26T02:57:50","date_gmt":"2017-04-26T09:57:50","guid":{"rendered":"http:\/\/drduru.com\/onetwentytwo\/?p=39099"},"modified":"2017-04-26T02:57:50","modified_gmt":"2017-04-26T09:57:50","slug":"t2108-update-170425","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2017\/04\/26\/t2108-update-170425\/","title":{"rendered":"Above the 40 (April 25, 2017) – The S&P 500 Follows Through And Scratches Overbought Levels"},"content":{"rendered":"

AT40<\/strong> = 67.2% of stocks are trading above their respective 40-day moving averages (DMAs)
\nAT200<\/strong> = 65.1% of stocks are trading above their respective 200DMAs
\nVIX<\/strong> = 10.8 (volatility index)
\nShort-term Trading Call<\/strong>: bullish<\/p>\n

Commentary<\/strong>
\nThe French Fly<\/a> continued apace as financial markets continued to celebrate. In my previous post<\/a>, I failed to post a chart of the iShares MSCI France (EWQ). <\/p>\n


\n
\"The<\/a>
The French Fly caused an impressive breakout to a near 3-year high for the iShares MSCI France (EWQ).<\/figcaption><\/figure><\/p>\n

\"The<\/a>
The monthly chart of EWQ shows the tremendous upside potential for EWQ in a recovery scenario.<\/figcaption><\/figure>
\n<\/center><\/p>\n

The major relief from the first round of the French Presidential election, what I call the French Fly, pushed EWQ to a major breakout to a near 3-year high. Yet, as I pointed out in my last “Above the 40”<\/a> in discussing the lack of apparent fear in the euro, EWQ showed very little trepidation about the election. Indeed, going into the election, EWQ bounced near support at its 50-day moving average (DMA) and even at one point traded at a near 3-year high before fading a bit. In other words, I am hard-pressed to find evidence in the expected places that financial markets held authentic fear surrounding events in France. I am even more interested now in the bull story for France, and Europe in general, because of the tremendous upside potential of a growing recovery story.<\/p>\n

On the other side of the Atlantic, the U.S. market continued its own celebration as it apparently chose to focus on positive U.S. headlines about tax reform and the likely avoidance of a government shutdown. <\/p>\n

<\/p>\n
\n

With S&P 500 trading well above upper-Bollinger Band, sold $SSO<\/a> shares and calls. Ref: https:\/\/t.co\/1IY5TvrkiX<\/a> $SPY<\/a> pic.twitter.com\/H30qRF8wAj<\/a><\/p>\n

— Dr. Duru (@DrDuru) April 25, 2017<\/a><\/p><\/blockquote>\n