In This Issue:
Rally six weeks old...
Leaders down... no there back up again...
Earnings, still not real signs of improvement
Treasury sales still falling, so are housing permits and starts
Quote of the week
"Anyone who is doing anything sensible right now is either losing money or is out of the market entirely," Quant trader "who is seeing something scary in the capital markets" in article by Tyler Durham.
Rally now six weeks young...
This rally marked its sixth-week birthday this week. Since hitting its low in the first week of March, the S&P500 is up 28% with Financials leading the pack. But that being said, this and most other major indexes are getting really stretched (overbought) and 89% of the stocks in the SPX index are above their 50-day moving averages (DMA), which is the highest level since mid-2006 according to Bespoke. Last week we mentioned that the index was 8% above its 50-DMA and that extended to 9.6% this week. Another challenge that faces stocks this week is that major indexes are getting close to bumping up against key resistance areas that taken together with how overbought stocks are across the board, increases the chances for a correction....