etfmsolutions: Overbought...10.05.15

Monday, October 5, 2015

Overbought...10.05.15

With the DOW up 300 points today, The RSI2 at 98 and the VIX below 20 for the first time since Aug 20th the markets are in overbought territory. After 5 up days its time for a pause. The technicals did turn negative in the last hour although price held up into the close. What was surprising was that the VIX was only down 7 percent....we expected a much larger contraction given the sustained bullish action today. If you looked at the Sunday night post (below) you'll note the upcoming economic news reports...some of which may derail the current upbeat mood.
As of 4:30 PM PST (aftermarket 4.5 hours) SPY is down .$.62 in active trading.

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