January 12, 2019 - 8:28 AM EST
The Great Paradox In Markets
The Great Paradox In Markets

Over the past few weeks, the stock market has moved from an oversold extreme to an overbought extreme, a function of the violent December sell-off followed by the near-vertical rally.

On December 24, the S&P 500 closed at 2,351, down 14.8% on the month and 20% from its all-time high. Notably, the NYSE McCllellan Oscillator (a market breadth indicator) hit one of its lowest levels in the past 20 years: -109.61.

Note: Data on $NYMO (McClellan Oscillator) is from StockCharts.com and goes back to June 1998.

By all accounts, the market was extremely oversold. What

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Source: SeekingAlpha (January 12, 2019 - 8:28 AM EST)