The Bulls are encouraged by the strengthening breadth of The Trump Rally.’s extension.
A gauge of momentum: the 5 Day MA of new 52-wk highs on the NYSE relative to lows is just off its 10 yr highs.
The Bears are pointing to measures of extreme positive sentiment; such as record call option volumes to bolster their case for a pullback.
There is no way to square that conflict now between high optimistic sentiment Vs high momentum.
Buying breakouts with leveraged positions in this kind of environment is risky.
Shorting this momentum is expensive as the positive conditions can continue for wks or months.
Investors are the most Bullish on stocks and commodities since February 2011 according to our data. Yet, a decline in cash exposure is showing a sell signal for stock.
The most likely scenario is a limited Northside with the probability of a 3% to 8% pullback from now to February. That leaves the Bulls happy and the Bears with a poor setup.
The S&P 500 Index capped a 5-day pause to refresh Tuesday, as Congress moved toward a spending package that will boost the economy and the Fed confirmed easy money long term. The US benchmark is trading a its all-time highs and has risen 65% from its March lows.
HeffX-LTN’s overall technical outlook for the benchmark S&P 500 index is Bullish with a Very Bullish intermediate bias in here. The support is Strong and the resistance is NIL
Have a healthy day, Keep the Faith!