After the rally of the past 9 days, the markets are somewhat overbought. Some consolidation might make the ensuing move more sustainable. The number of SPX stocks reaching 30 day highs has broken the peaks of the previous 2 years (see chart).

% of S&P 500 Issues Reaching 30 day Highs

_of_sp_500_issues_reaching_30_day_highs_1

Source: Redwood Technimentals

The back and filling action at this point would be a healthy sign that the markets are not getting too far ahead of themselves.

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Category: Finance

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