Stop Sign Ahead
The 14,000 level of the Dow Jones Industrial Average continues to act as an attractor, as I noted two days ago. We are seeing swings that tend to take it above and below that level, which is very typical round-number behavior. More important, though, is the fact that the swings are creating a sideways area that appears to be a stopping point. In January, just about every day was on the upside. February is alternating up and down days. That suggests a possible end to the advance.
My concern is not that we are likely to see a pullback, which is overdue after the January rise, but that the indicators, such as the 55-day Arms Index below, are saying the market has become overbought on a longer-term basis, hinting that this is likely to be more than just a small pullback....225 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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