Short Term Negative, Intermediate Term Positive

Below is the 10 day moving average of the NYSE Advancers-Decliners showing that we are short term overbought

The overbought reading is a negative in the short term. The fact that this indicator has made a higher high and that we are intermediate term oversold are both positives in the intermediate term. This makes it very likely that the market will move higher in the intermediate term even if we do see a short term pullback.

If the market were to decline during the remainder of this week that would lead to a good risk/reward setup. In recent years we have seen fewer pullbacks in up trends, so a pause for a few days would also likely be buyable. In the very short term the market is vulnerable to a pullback.

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