WALL STREET CRAPS STOCK MARKET STRATEGY DECEMBER 18, 2016
STOCK MARKET STRATEGY FOR DECEMBER 18, 2016: The stock market continues to hover near its all-time highs in the majority of indexes. With the internal breadth indicators nearing “oversold” readings, it looks like a brief decline of maybe one or two trading sessions will lead to another run to new highs and beyond. While most of the buying power has been spent on this present rally, a quick trade to the upside may be worth a bet until the end of the year.
Key underlying short-term market indicators show the following:
- NYSE McClellan Oscillator – Ultimate Indicator – 29 (oversold)
- NYSE Overbought/Oversold Indicator – Ultimate Indicator – 33 (neutral)
- Nasdaq McClellan Oscillator – Ultimate Indicator – 31 (neutral)
- Nasdaq Overbought/Oversold Indicator – Ultimate Indicator -35 (neutral)
- Volatility Indicator – Ultimate Indicator – 55 (neutral)
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THE BOTTOM LINE: The Fear/Greed Index is currently reading “Extreme Greed” and means that this is more a time to sell than to buy. But with the internal breadth indicators nearing “oversold,” it looks we will get our “Santa Claus Rally” right on cue for a ride up until New Years Eve. But after that, the reality of an overbought, over-valued, and over-loved market will bring the correction or even an end to the intermediate-term rally since the Election.
