Unlike the RUT, the Market Sentiment on the NDX is sloping up and has not yet reached the overbought levels above 80. We can expect more gains after a slight pullback coming up in the NDX.
The market's trade in the first five days of the new year is often a barometer for the rest of January. The SPX gained about 1.3% in the first five days of trade, but fell slightly today. This bodes well for a positive January. For large caps, but the RUT could be in trouble. It barely broke even after a strong start last week.
GLD and TLT made strong moves in the first 5 days of the new year. This is in the face of rising equities, so it seems bullishness abounds in many markets.
In fact, only the energy and utilities sectors were down in the first five days of trade this year. Strangely, healthcare led all other sectors.
In the face of this bullishness and because the first five days have ended I sold a 22295/2305 call spread on the SPX for expiration this Friday for 85 cents at the highs of the day. The market closed on its lows, so the spread is worth 50 cents now.
