Range Momentum

Stocks and indexes so far this afternoon reversing the downside action of yesterday.  Much of the trade has been like this with momentum nerds continuing to dominate daytime action.  Greek troubles will play with prices but it is hard to get the bulls into a corner.

Tech stocks such as AAPL, cash giant machines, with overpriced stocks to accommodate all who wish to enter,  have event price spreads nearing one and half times value.  There is not enough money in the system to pay off all the longs and some will have to eat at cheaper prices.  If you paid, or better, lent AAPL 110 at the beginning of  the year, you our now looking at 19.5% return and a 370% return since Jan of 2008.  Cheerleaders waving the AAPL flag forecast much higher prices but always have that upward stare.

Economic growth remains dull but Fed is determined to raise rates unless they can find another excuse to keep assets juiced.  

A CoverRisk.com  indicator for determining downside potential has reached the strongest level since May of 2008.  In fact it was seven years ago on May 19th, 2008 that the SP500 reached the highest price it would hit for the rest of the year.  While the indicator simply measures  the spread between various upside scales, it has only been this high on one other occasion which was proceeding the break in 2008.

The Four Quarters of the Apoclypse

Data from CoverRisk.com