The last two days have set slightly lower lows. However, the bulls rushed in to buy the dip. There is clearly resistance they have not been able to surmount during the trading day. The market has had a tendency in recent years when faced with resistance to end up gapping up and over it. Will that happen again? The market is still short term extended and long term over bought. That makes it pretty hard for people to chase. With price so extended short term, people might sell into the gap up instead of buying it.
Lets take a peek at the new highs chart.
Despite the new closing high for this bull market, we had the lowest number of new highs so far this year.
Here is the current breadth chart.
The McClellan oscillator is showing a bit of a loss of momentum. The 10 DMA breadth chart curled a little today, also losing a bit of momentum. Neither of these indicators have gotten weak enough to say a pullback is imminent, though it remains a possibility. This is still not in a great place to initiate any swing trades. A little more patience is required.
Bob
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