On the positive side of the ledger, the S&P 500, Dow, Dow Transports, Russell 2000, S&P Midcap Index and Value Line Geometric all recently finished in record high territory, asserts Dan Sullivan, technical expert and editor of the industry leading advisory service, The Chartist.

As you know, the most bullish thing the market can do is go up and set record highs in the process. The breakout by the Dow through its February 24th prior bull market highs was confirmed by the Dow Transports that had set all-time highs for the third day in a row. This generated a confirming Dow Theory buy signal.

On top of this, the Chartist overbought/oversold indicator generated a heavily overbought reading. This is near term positive because on balance, the market has a strong tendency to continue to rally in the face of overbought readings.

For the benefit of new readers, we consider the market to be heavily overbought when the Value Line Geometric closes 3% or more above its 19 day exponential moving average. Another positive has been the expansion of new 52-week highs that have numbered 215, 461, 278, 392, and 500 over the last five trading sessions.

Add to this the fact that several other widely followed indices hit record highs along with the Advance Decline (A/D) Line, and you have ample confirmation almost all across the board.

The ability of the A/D Line and Value Line Geometric to set record highs should be quite beneficial to the market’s progress going forward. We say this because these two indices have a long history of topping out ahead of the overall market.

Where do we go from here? The recent surge in U.S. Treasury bond yields has dominated market action over the past several weeks. The yield on the 10-year has risen from below 1.0% at the start of the year.

The increase has heightened concerns that inflation could be an issue as the economy recovers from the effects of the Covid-19 pandemic. The result was a sharp sell-off in the technology sector with the Nasdaq Composite briefly dipping into correction territory.

Over the last couple of days, the rise in interest rates has cooled and tech shares have rebounded, but the episode demonstrated stocks’ vulnerability to higher rates.

The real question though is what happens in the months ahead? Many economists, including Fed officials, think that the spike in consumer prices will be temporary.

They see inflation going as high as 2.8% in the second quarter but then tapering off towards the end of the year. It appears for now that the market will walk a fine line between strong economic growth and inflation concerns.

 As we go to press, the market has the wind at its back with our models in a highly bullish mode. Our advice for investors who are following our real money accounts is to stay fully invested.

ViacomCBS (VIAC) enters our relative strength ratings at the number 8 position. Shares have been in a sharp uptrend since the beginning of the year. From its low on December 22, at 34.12 it has surged 153% to an all-time high on March 11, at 86.28. It trades well above its up-trending 50 and 200-day moving averages.

The company is a global media and entertainment company focusing on creating premium content and experiences for audiences worldwide.

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It operates through various brands, including CBS, Showtime Networks, Paramount Pictures, Nickelodeon, MTV, Comedy Central, BET, CBS All Access, Pluto TV and Simon & Schuster, among others. It also offers production, distribution and advertising solutions for partners across five continents.

Fourth-quarter results were $783 million, or $1.26 per share compared to a loss of $302 million, or 49 cents a share, a year ago. Revenue rose 3% to $6.87 billion, slightly below estimates of $6.89 billion.

The company said it expects to reach 75 million global streaming subscribers by the end of 2024. It had a total of 30 million as of December 2020.

On March 4, the company announced its launch of Paramount+, a streaming service with an emphasis on live sports and news. The service will compete with Netflix, AmazonPrime and Disney+.

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