Bullish or Bearish? Week of Oct. 2, 2017

My latest MarketWatch column: https://goo.gl/REoRXg

Here are the latest technical and sentiment indicators:

Technical Indicators (daily chart)

S&P 500 is above its 50-day MA = Bullish

MACD (S&P 500; 19,39,9) is above its zero line = Bullish

MACD (S&P 500; 19,39,9) is above its signal line = Bullish

S&P 500 support @ 2473 (50-day moving average)

 

Sentiment Indicators (+RSI)

II survey: (Sept. 26): 54.3% Bulls; 17.1% Bears = Bearish

AAII survey: (Sept. 27): 33.3% Bulls; 28.7% Bears = Neutral

VIX: @ 9.50 = Bearish

RSI: (S&P 500) @ 68.77 = Overbought

Comment: More professional traders and investors have recently warned that the market is way overbought, the valuations are obscenely high, and that a number of indicators such as the Schiller P/E CAPE ratio are the highest (30) since 1929 and 1997. Schiller wrote that it doesn’t mean a crash or bear market is imminent, but it is a “red flag” (my words). And yet, the market crawls to all time highs on low volume and institutional participation. What is a trader to do? 

In my opinion, sit and wait because the day of reckoning will eventually come. I’ll have a lot more to say later this week when I publish my next column.

I will notify you of my blog posts via twitter @michaelsincere

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