The market started the day off strong only to move sharply lower. A reversal day looked highly probable until the last hour of the day when the bulls once again pushed the higher-beta sectors higher. IWM (Russell 2000) has now reached an overbought level not seen in quite some time. If you look at the RSI over several time frames you will see that IWM is indeed at a level that looks prime for a trade.
However, as I have stated before nothing is guaranteed in trading as there is always going to be an anomaly that leads to a losing trade.
What is important is how you manage that trade.
I would also like to let everyone know that we will be offering the opportunity to have our Short Iron Condor auto-traded. We will be limiting the amount of subscribers to 75 so spots will go quickly. If you wish to participate email us at
support@crowderinvestments.com
and we will do our best to save you a spot once we make the portfolio live, which will occur after the March expiration cycle.
Overbought/Oversold levels for February 22, 2007
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SPY - 66.5 (neutral)
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DIA - 42.1 (neutral)
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IWM - 87.1 (very overbought)
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QQQQ - 80.9 (very overbought)
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OIH - 66.8 (neutral)
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GLD - 68.1 (neutral)
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Have a great night!
Andrew Crowder, Chief Investment Strategist,
www.crowderinvestments.com