THE WEEKLY TOP 10
Table of Contents:
1) The market acts great, but it’s also getting expensive, overbought and over-loved.
2) The key tech ETFs…& several key tech stocks…are beginning to show some cracks.
3) Ditto for the high yield market…especially at the bottom of the quality scale.
4) Having said this, a “melt-up” into year-end is not out of the question. It’s just not likely.
5) Another bullish development is the rise in copper…which is now testing key resistance.
6) Watch the XLY to see if the consumer will remain strong through the holiday season.
7) The biotechs are overbought near-term, but any further rally will be quite bullish.
8) The Fed’s most recent QE program began with very different market conditions than usual.
9) Crude oil rallies, but the energy stocks continue not to care.
10) Summary of our current stance.
1) The stock market acts great…and thus human nature leads a lot of people to believe it will continue to rally strongly. However, the stock market is becoming very overbought. More importantly, it is becoming very expensive…especially if you look at the most accurate reading: the price-to-sales ratio. Therefore we believe the stock market will have a very tough time rallying a lot further from current levels…and could/should see a pull-back soon…..Also, we continue to believe a willingness to stay nimble will be the key to success for investors in 2020.....To read more about this issue and to see the chart on the price-to-sales ratio, click here to subscribe to "The Maley Report" (TheMaleyReport.com).
2) The tech group has provided great leadership for the stock market all year. However, they’re starting to show some cracks on a technical basis. The XLK & SMH tech ETFs are coming off of overbought conditions…and their MACD charts are ...