It’s not only that this rally has gone parabolic, it is that it is getting ever more narrow and that is virtually guaranteeing a misstep on this tight path it has embarked on.
Note the underlying issue: We’ve gone from no 5% pullbacks, to no 3% pullbacks, to no 1% pullbacks. Heck, we can’t even get 0.6% pullbacks:
The result: The rally is not only parabolic, but it is as thin and narrow as I’ve ever seen it::
The trend either continues or it doesn’t. How’s that for profound? For giggles here’s the implication if the trend does NOT break:
There. $SPX 4900 by year end. 😂
Well that’s what retail seems to think at the moment by deploying ever more cash into these uncorrected markets at these levels:
If the channel does break ( which I think it ultimately will) here’s an analysis of potential target areas to consider: 2018 Corrective Risk Zones.
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Categories: Market Analysis