Stocks Getting To Overbought Levels
Stocks are mostly higher in early trading, but just by a fraction. The market hasn't had a down day in roughly seven session, which is a pretty long streak. That has moved the indexes up into overbought territory. So now the question is what type of pullback will we see, if any?
Some odd economic data this morning. The headline jobless claims was 292,000. This was the first time jobless claims dropped below 300k since March 2006. But the DOL said there were computer problems, so basically the figures aren't correct. So the DOL doesn't believe this week's drop in jobless claims signals a change in the labor market. Odd.
Asian markets ended mixed. Japan's PM has decided to raise the sales tax in April 2014. New Zealand and S. Korea both held rates unchanged at 2.50%, as expected.
Europe is mostly lower. Eurozone industrial production fell -1.5% last month. Greek unemployment hit a new record high of 27.9%. An ECB member said they believe current policies are appropriate, but they have talked about another LTRO.
The dollar is lower today but that is not helping precious metals. Gold prices are down big to $1331. Silver prices are down nearly 4%. But oil prices are up a bit near $108.18.
The 10-year yield is easing back a bit to 2.88%. And the volatility index is flat near 13.90.
Trading comment: We have started looking for individual situations to put more cash to work. Most of these are stocks that have had mild corrections and look ready to resume their uptrends. Ditto some of the ETFs. We are trying not to add to stocks that are still extended on the charts. With the market reaching overbought territory, we should see some sort of pullback in the near-term and will look to use any weakness for opportunistic buys.