Each week I update the Bullish Percent Indicators I expect to see some declines or weaknesses somewhere in the U.S. Equities market. Stocks are holding up in nearly all sections. The only real weakness is in the Telecom sector.
Index BPI: No changes in the offense and defense camps this week despite some slight increases in several indexes. There is nothing here that raise any concerns. Neither of the two broad indexes, NYSE and NASDAQ, are over-bought. This is a good sign this market could move higher.
Sector BPI: Energy and Health, two important market sectors, moved from defense over to offense. That leaves only Materials and Telecom in the defensive camp. Most sectors are now over-bought (70% bullish or higher) and that does not bode well for the future. When there is little head room for more mobility upward, we are primed for a correction. That likely will not happen until we are well into 2018. This is not a prediction as that is always a dangerous activity when it comes to the stock market. We will just stand by and watch the numbers and move where they tell us.
Keep working the Kipling as you manage your portfolio(s).