Alarm Bells for Both Bulls and Bears Signal Choppy US Y... :

Alarm Bells for Both Bulls and Bears Signal Choppy US Y...


Bulls are being encouraged by the strengthening breadth of the current rally. A gauge of momentum — the five-day moving average of new 52-week highs on the New York Stock Exchange relative to lows — is just off its highest in 10 years. Bears are pointing to measures of extreme positive sentiment — such as record call option volumes — to bolster their case for a pullback.
“There is really no way to perfectly square the conflict that’s happening right now between high optimistic sentiment versus high momentum,” wrote Sundial Capital Research Inc. founder Jason Goepfert in a note to clients. “Buying breakouts with leveraged positions in this kind of environment is highly risky. Shorting isn’t much better, since momentum conditions like this can continue for weeks or months.”

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