S&P500 RSI Highest Since Right Before DotCom Crash
Wall Street tagged new highs this morning, as central bank suppression of vol coupled with buybacks pumped markets higher. But around 10:00 am, the floor dropped out, and sellers triggered a liquidity gap measuring almost -140bps in SPX500 into late afternoon.
Glancing at the weekly, resistance is seen in the form of a pending bearish piercing pattern. RSI prints at 89 signaling price is overbought.
The trailing 12-month P/E ratio for SPX5oo is 23.6, above the 10-year average of 17.0. Prices are now considered paying a premium.
Current Shiller PE Ratio: 33.80. Once over the black ascending line, there tends to be a reversal a short time later. Valuations are very stretched. This is not the beginning of a cycle, but more we’re nearing the latter innings.