The concern that the Dow has gapped up in the overbought condition is offset by the fact that the other indexes are trading positive without any signs yet of exuberance. The gap up in the Dow needs to be watched closely. If trading came back down through today’s open, that would be an indication that some profit-taking was occurring in the Dow stocks. However, this does not infer that the other indexes, which have recently been trading somewhat independent of each other, would not continue the uptrend. Stay predominantly long but be protective of profits.
December 13th Daily Market Comments
The concern that the Dow has gapped up in the overbought condition is offset by the fact that the other indexes are trading positive without any signs yet of exuberance. The gap up in the Dow needs to be watched closely. If trading came back down through today’s open, that would be an indication that some profit-taking was occurring in the Dow stocks. However, this does not infer that the other indexes, which have recently been trading somewhat independent of each other, would not continue the uptrend. Stay predominantly long but be protective of profits.