With a lot of talk around of the markets being overbought, it's time to turn to our trusty ol' McClellan Oscillator for checking if the markets have actually reached overbought levels. Without further ado, below are the two year charts of NYSE and NASDAQ McClellan Oscillators respectively with the overbought levels marked on them.
As we can see from the above charts, the markets have not reached overbought levels, at least not yet. I admit I was one of those who expected the markets to have reached levels. Of course, this does not mean that we go straight up from here, but just that odds don't favor the bears quite yet. That said, watch out for financials which might drag on the overall markets.
Click here for Chart of the Day. Also, check this free special report on why diversification doesn't work if you haven't done so already.
Take care and good luck!