DOW, S&P, NAS CLOSE HIGHER BUT VOLUME LACKING, UNTIL WE SEE BIG VOLUME THIS RALLY IS SUSPECT
Posted on May 8, 2008
Filed Under Profitable Trader |
Today was pretty much a lackluster day for the markets. The good thing is the Dow, S&P, and Nas were able to close higher. The bad thing is that volume was extremely low. Not only was it lower than yesterday, it was lower than the 50 dva. This is basically a market trendng higher on low volume. This can only last for so long and unless the smart money starts coming in most likely this rally will retreat.
Today the NYSE short interest ratio made another all time high of 12.94. This means it will take almost 13 days for all the shorts to cover at the average daily volume on the NYSE. The market is still going up so it is not wise to be short. The trend is your friend and those going against it are going to get squeezed if all the mutual funds that are sitting on cash start coming into the market. As long as stocks keep going up I will be long, however this is not the time to be fully invested on margin. We are at some serious resistance as we close in on the 200 dma and we must clear this hurdle if we are to go any higher.
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