Thoughts for next week

After reviewing market internals indicators we can easily see this last week's rally ran on sound support. Last week rises have been coupled by increases in most instruments. The fact that this rally has gone too long and too fast, though maybe is true to the common sense, is not tradable at all. Nevertheless, we think the time for a pullback is very close so we have to be alert and watching the correct indicators to avoid losses and the long side and ideally catch a nice short entry when the market turns. So our job for next week is
1) not to fade the rally until clear signs are shown.
2) Actively look for indications of pullback not only in price but also it corresponding moves at market internals, currencies and bonds.
In regards of this last task, we found this chart of NYHL which is quite interesting, particularly if next week continues to the down side.

NYHL










Also see here an update of this previous study:

AUD - JPY ratio (not Forex)



As always, close surveillance on USD. If any pullback is to come to stocks markets, it should start at the USD. Here are some signs I have found:




close up view: