The Market Needs a Rest

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Our View

After a morning rip and selloff, all three major indices — the Dow, S&P and Nasdaq —- closed modestly higher. Small caps closed the day lower, with the Russell falling more than 1%. 

The NQ closed higher for the 7th day in a row, its longest winning streak since January. Maybe the markets go up today, but I have a feeling we could see a down day and possibly a few more. Even if traders are bullish, some rest makes sense after last week’s move. 

I think there is a lot of resistance between 4390 and 4420. This rally is short-term over-extended and overbought.