FAST FIVE: Stocks Surge As Earnings Roll-In, But Is Risk Gone?
Our concern is that while the expected rally from support occurred, there has been very little “conviction” to that advance.
Extremely long periods above the 200-dma have often preceded larger drawdowns.
For an “average” to exist, the market must trade both above and below that “average price” at some point.
Another measure is the P/E to VIX ratio which recently also peaked at 2.0.
While that time is not now, don't become overly complacent, thinking this market can only go higher.