Financials

On Monday we were up all day but the financials were very weak. At the end of the day the market gave up the ghost. Today, the financials are staying positive even though the market is lower.

Put Call Ratio High

The put call ratio is elevated once again. The CBOE is at a very high 1.21.

John Roque On Financials

Over the years John Roque has been right a lot more often than he has been wrong. I am always interested in his view. He does not seem to be too keen on the financials.

Update Of The Rydex Chart

The Technical Take has posted an updated Rydex chart. As you can see Rydex traders have become more bearish.

The Investors Intelligence numbers came out. The bulls are down to 34%, which is low and consistent with a bottom. However, the bears are still relatively low at 26%. A lot of people are in the correction camp.

On The Grind

Despite yesterday's rise investors continued to purchase puts and Rydex traders became more bearish. While on a few occasions these indicators became more stretched, I believe this argues for a continued grind higher over the next few days.

If the market rises or goes sideways through the end of the week we might actually become slightly overbought. If we see a sentiment shift during that time as well that would set us up for a possible move lower next week.

To Bail or Not To Bail

Will Europe bail out Greece or won't they? There are a lot of unknowns that will shape trading tomorrow. The world economies are unbalanced and contagion is a definite possibility. However, barring contagion and putting aside Greece I would expect the market to grind higher for a few days to keep the bears honest. Have a good night.

End Of Day

The final hour of the day on days with big moves has tended to go in the direction of the move. That would argue for a strong final hour.