The bulls came out and bought the morning gap down immediately. Nothing bearish in that action. We are only 20 points from the April high. This close it is a little hard to believe we won't test that level, but we will see. Normally the market overshoots some on upside retests. Very rare to make a lower high this close. In today's news environment something could easily come along to change things though.
Here is the 60 minute chart.
After they bought the morning dip everybody fell asleep. The last three days we had over 225 new highs, today only 133. That kind of surprises me a bit. That is less then we had all through the month of July. That is a caution flag. I have no idea why that happened. I will be monitoring the next few days to see if it was an anomaly or not.
I don't really see anything that hints at what tomorrow is going to bring. We are still above the upper channel trend line on the daily chart in over bought territory. More consolidation is possible.
The chart practice site has been updated if interested. http://traderbob58-chart-practice.blogspot.com/
If you find yourself with some time on your hands I recommend reading these articles.
Here is an interesting article on market valuation using multiple metrics.
http://rpseawright.wordpress.com/2012/08/06/leading-investment-indicators-2/
Here is an article from a bull outlining his bullish case.
http://www.bigtrends.com/options/strong-price-action-amid-the-most-hated-stock-rally-in-history/
Here is an interesting article on investor sentiment.
http://www.streettalklive.com/daily-x-change/1100-are-investors-really-that-bearish.html
Bob
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