- Investors have warmed up to the market in the past couple of weeks but are still hesitant. A further rally, especially one that takes the market over resistance, could get sentiment into the extreme territory that typically leads to a pullback.
- Seasonality is strong today and tomorrow but turns weaker on Wednesday.
- The market is overbought so I would be surprised if the market could rally uninterrupted for the entire week.
The Last Dance
There are a number of reasons why I believe strength early in the week could lead to weakness later in the week.