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The stock market soared last week, what is next?

SPX Tech analysis by Simon Kazinsky on 09:08 July 09, 2018 EST

As per previous technical analysis I am not convinced yet that it is the time short stocks.

For the Standard and Poors 500 the leg up from the 1500 level is still underway and no war trades, wage stagnation or increase in the unemployment rate can fade the momentum.

Retail traders are piling on shorts and currently for every 100 traders more than 60 are shorts. This is not a good sign for bears.

The medium term support is now at around 1744 which was a temporary high the index took around 3 weeks to be able to break.

We might see the S&P 500 get close or set a new all time high now. As pointed out in previous articles I'd like to see it reaching the 2940 level because a multi year fibonacci level sits there. It is now only 6% away from it.

The average PER for the stocks traded in the S&P index is now over 25. This means stocks are extraordinarily expensive in historical terms.

The increase of volatility and the wild swings are warning that the long overdue drop on the US stock market may be close but If you are a bear it may pay off to wait until some weakness appears and a mid term supports breaks.