The near term call on the market is tough but looking out a few weeks my bent is still on the bearish side. We are seeing record breaking sentiment levels which typically lead to corrections. However, we are also in a very seasonally strong part of the year. To make things tougher the strong seasonality usually works best in good years such as the one we just had.
In hindsight, when we look back at this week the outcome will seem obvious. If we go lower everybody will point to the nosebleed sentiment levels and if we are higher everybody will point to the seasonality. So why am I bearish on what seems like a coin toss? Because when I look out further, even if the market does make its way higher in the next week or so I believe it will be a last gasp. I believe there is a couple of percent reward on the upside with a lot more downside potential.