Expect More Selling
After the fast advance last week, the markets looked as though they were ready for a pullback, and that is what started to develop on Monday. The Arms Index moving averages had become overbought, the volatility index (the VIX) had gone back to a very complacent level, and all the averages were at levels that have a history as stopping places.
However, the drop, while quite large, showed a very obvious lack of concern. Volume was light and was not concentrated heavily in the declining stocks. Therefore, a quite neutral Arms Index kept the moving averages in overbought territory....337 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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