Are We at the Top of Mt. Everest in the Markets

Stocks gasping for air as breath weakens.

They say that as you climb Mt. Everest, you slowly die due to the lack of oxygen. The same could be said about the lack of Breath in markets today.

The SP500 Breath Break Down

Lets look at the SP500.

The Blue line is the Accumulation / Distribution Line, the yellow is the 90 Day EMA and Orange is the 250 Day EMA. Looking at the relationship of the A/D Line vs the 90 Day EMA, the A/D cross the 90 back in April of 2020, the availability of “oxygen” is much and the SP500 moves higher. But look at went the spread between the A/D and 90 Day EMA begin to widen, the SP500 begins a sideways period that eventually leads to a coming together again of the A/D and 90 day EMA leading to down market in 2022.

Fast forward to the beginning of 2023 and the A/D crossing through the 90 Day EMA. Look at the spread between the A/D and the 90Day EMA today. WOW! Sizeable spread there. Bring in the Slow Stochastics and you have signs of a over bought SP500.

Conclusion

Markets are like humans. Without Oxygen you eventually die. Got profits…take them or loose them as a trader friend said to me once.

Subscribe for $25 a month. Get trade ideas, intermediate term portfolio ideas and my MACRO point of view.

Subscribe now

Share

Read more