On Friday the market literally gave a thumbs up to the tax plan and broke out to new highs. And before that we had a hawkish Fed on interest rates, despite the risk of inflation, and the more heated the war of words between the US and NK gets, the higher the market goes.
So everything is all good, right? Well, looking at volume things actually are pretty good for the bulls, at least for the time being. The month of September was all about accumulation (Our GI was in BUY mode most of the month), but now TVO is rising above 3.0 which could mean investors have bitten off more than they can chew.
Looking ahead, a potential catalyst for any kind of pullback would be the jobs report this Friday. Some folks would say it’s too obvious (or the market just doesn’t care) and therefore we keep going higher. Volume does tend to shift before price (and opinions for that matter), so we’ll be watching for a TVO reversal… as markets can only stay HUNGRY for so long. -MD
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