Markets are Overbought

Markets are in the overbought territory. NYMO and NAMO readings were over 50, which are considered overbought conditions. Markets could stay overbought though. The 4 day rally with a little over 4% got me looking to short SPY, at least short term.  Support and resistance at $131.41, 50 DMA and a declining trend line should be a good resistance at least for a couple of days. Looking for at least a pullback to 20DMA - $129 area on SPY which is short term support. Consolidation around 20DMA would be healthy if this market wants to run much higher. Today was the last day of the Qtr. markets have been struggling since May. Also with 3 day weekend I'm expecting people wouldn’t want to hold longs into the long weekend nor take new positions. Also Canada day is tomorrow expecting a slow grind lower with much lower volume.

AAPL 6.28.11

Just a quick update from yesterday's post and today's trade. Nothing majorly has changed on charts for me to take down the trade, $335-$340 is still resistance. Here are the updated Charts.

Long Jul1 330 Put; would look to add at around $338 and would stop out around $340. Weekly option move quick if we start to consolidate around $335 area I would exit weekly options and would look into July - Aug. AAPL is scheduled to reports earnings 7/19/11 would look to be completely out by then.