The McClellan indicator tells us that we are at a market top.
Large stocks seem more vulnerable here, especially the NQ8 and XLK
But fortunately MSFT published strong earnings yesterday, which helped ease the selling pressure.
We can also see that the 10Y rate has eased down to 3.4%, which helped valuation back below overvaluation levels.
Conclusions:
Even though markets are not overvalued here and even if MSFT published good earnings, the Fed will probably raise rates again in May, which will be markets negative.
I suspect that investors will sell the overnight bounce.
