As Neutral as it Can Get
We closely track just over 200 of the most liquid ETFs each day. We then look at the average ConnorsRSI reading of this universe to give us an overview of just how overbought and oversold the overall market is. Today, the market comes in with a reading of exactly 51.00 which is pretty much as neutral as it can get.
On days like today, the best course is to allow the market to work through the neutral condition. With so few edges in place, traders tend to “look for edges” when in fact few exist. As I pointed out on Friday, this sideways movement has been the theme for 2014 and it will eventually resolve itself, especially on a shorter-term basis. Let the market show its hand and allow for the edges to bring themselves to you (they always do).