Drizzt: long term market analysis is a series once or twice a month where we take a look at longer term trends in the market to get our bearings right on the general direction of where market prices is going.
Markets have turned out pretty well for those that are long. However, the January move was so sudden that many were waiting for the pull back that never came. It looks synonymous with all the past big moves that markets remain overbought and stayed over bought.
Weekly S&P500 and STI
The long term indicator we use is the cross over between the 17 week EMA and the 43 week EMA. A cut of the 17 week EMA below the 43 week EMA from above signifies an underweight and risk management position. A cut of the 17 week EMA above the 43 week EMA from below signifies an overweight position ...
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