S&P 500 - Top Chasers Out In Force


No Shortage of Clues

Traders, while prices in the S&P's have broken above the 2000 level, they are not gaining any meaningful traction higher.  As we all know, this rally is very deliberate and lethargic and there are certainly some warning flags.  However, despite this, it is tough to build a bearish case absent some meaningful pull-back.

Some of the most recent chatter for the bears revolves around the Russell 2000/IWM and how recent weakness suggests underlying weakness for markets in general.

S&P 500 vs. Russell 2000


Chasing Tops - A Colossal Waste of Time

History however does not offer too much conviction in trading off these divergences.  In fact only about 50% of divergences result in any meaningful market top.

Divergences & Market Tops


I am not saying there are not risks out there to the market, however I have lived through similar phases before in my 20-years as a trader.  Trying to pick the top is a colossal waste of time. Being a passive bull makes far more sense while making sure that I constantly take the pulse of the market so that when prices to begin to deteriorate, appropriate actions can be taken.

Recommended Content


Recommended Content

Editors’ Picks

AUD/USD flat lines above mid-0.6700s ahead of Australian jobs data

AUD/USD flat lines above mid-0.6700s ahead of Australian jobs data

AUD/USD attracts some dip-buyers on Thursday, around the 0.6820 region. Against the backdrop of the RBA's hawkish stance, the upbeat market mood acts as a tailwind for the pair. That said, persistent concerns over an economic slowdown in China, along with a modest USD uptick, cap the upside as traders await Australian employment figures.

AUD/USD News
NZD/USD advances to near 0.6200 due to risk-on mood, Fed interest rate decision awaited

NZD/USD advances to near 0.6200 due to risk-on mood, Fed interest rate decision awaited

The NZD/USD pair edges lower to near 0.6200 during the early Asian session on Thursday. The recent GDP data revealed that New Zealand's economy shrank again in the second quarter, suggesting the depths of its economic malaise.

NZD/USD News
Gold price stalls post-FOMC pullback from all-time peak; lacks firm intraday direction

Gold price stalls post-FOMC pullback from all-time peak; lacks firm intraday direction

Gold price oscillates in a range on Thursday and consolidates the previous day's post-FOMC rejection slide from the $2,600 mark or a fresh record high. Persistent geopolitical risks, along with signs of economic trouble in the US and China, lend support to the safe-haven metal.

Gold News
Australian Unemployment Rate expected to hold steady at 4.2% in August

Australian Unemployment Rate expected to hold steady at 4.2% in August

The Australian Bureau of Statistics will release the monthly employment report at 1:30 GMT on Thursday. The country is expected to have added 25K new positions in August, while the Unemployment Rate is foreseen to remain steady at 4.2%.

Read more
Ethereum could rally to $2,817 following Fed's 50 bps rate cut

Ethereum could rally to $2,817 following Fed's 50 bps rate cut

Ethereum (ETH) is trading above $2,330 on Wednesday as the market is recovering following the Federal Reserve's (Fed) decision to cut interest rates by 50 basis points. Meanwhile, Ethereum exchange-traded funds (ETF) recorded $15.1 million in outflows.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Majors

Cryptocurrencies

Signatures