How Oversold Are Stocks?
05/21/2010 9:45 am EST
It was another ugly Thursday as despite a mid-day rebound in the euro, stocks plunged into the close. Sentiment has shifted drastically as there were too many bulls just a few weeks ago, and now, everyone seems bearish. The market is oversold as the McClellan Oscillator has dropped to -417, the lowest level since October 2008. The S&P chart shows that we are now at the lower starc bands. This does not mean that we can’t go lower over the near term, but does suggest this is a high-risk time to sell.
Tom Aspray, professional trader and analyst, serves as video content editor for MoneyShow.com. The views expressed here are his own.