After the fifth up day in a row the market is testing new 52-week highs again. It’s looking like this bounce is indeed for real, and not the dead cat bounce I was looking for a few days ago. One of the indicators on the major indices that I was concerned about is On Balance Volume (OBV). It was looking really weak at the end of September, as well it should have after all the distribution days last month. Well now OBV has recovered to its September highs as well. So that’s showing good confirmation of this move. There’s no way I’d look to initiate longs here after 5 up days in a row, but I’m almost convinced that I should go back into buy the dip mode. A good number of the bearish candles from two days ago were nullified today by closes above their highs. So my list of potential shorts has evaporated for now. We’ve got a flood of earnings reports coming next week so I’ll likely just stay in cash until after the bulk of the reports are out.
Put call ratio not even budging that much as bears stand their ground.
nice observation. you nailed the top with that