A Cautious Week
Few changes evident in the Bullish Percent Indicators as the market is exhibiting little direction. The NYSE dipped a fraction while the NASDAQ moved up slightly. Sideways markets are not all that helpful to momentum investors.
Index BPI: In the major markets, only the Dow Jones Transportation Average (DJTA) shifted from offense to defense. For the second week in a row this average is priced in the “normal” range (55% bullish stocks). The majority of the large averages are over-bought. This is a time to be cautious.
Sector BPI: The sectors are showing similar patterns, although here we spit the difference between those in the offensive camp and those positioned with the defense. Financials, Materials, and Technology are all over-bought with over 80% of the stocks in these sectors showing bullish Point and Figure (PnF) graphs.