Wednesday, July 4, 2018

An oversold bounce, but how far?

Mid-week market update: I would first like to convey to all of my American friends my best wishes for a Happy 4th of July. Enjoy you day off, as more fireworks may be on the way.

The stock market appears to be starting an oversold bounce. Callum Thomas has been conducting an weekly (unscientific) Twitter poll since July 2016. Sentiment seems to be sufficiently washed out for an oversold rally.

Similarly, breadth readings from Index Indicators also show that the market is ready for a bounce.

The big question is, "How far can stock prices rise?"

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