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The January rally showed its first signs of cracking yesterday, as market leaders like transports and the Russell 2000 got hit hard. Even with yesterday's declines, the majority of stocks remain overbought. Last night we highlighted the most overbought stocks in the S&P 500, and below we take a look at where the 30 Dow stocks currently stand within their normal trading ranges.

In the chart below, the red shading indicates overbought levels, while the green shading indicates oversold levels. (You can learn more about how to read the chart at the bottom of this post.) As shown, 19 of the 30 Dow stocks are overbought, while none are oversold. Last week at this time, 20 of the 30 Dow stocks were overbought, so there hasn't been much of a change over the last seven days. The Dow stocks that are currently the most overbought are Procter & Gamble (PG), IBM (IBM), Pfizer (PFE), Home Depot (HD), Johnson & Johnson (JNJ), and McDonald's (MCD). Only one stock in the Dow -- Boeing (BA) -- is below its 50-day moving average.

With so many stocks still trading in overbought territory, bears have a lot of room to push shares lower if the bulls step to the sidelines.

(click to enlarge)

Source: Dow 30 Trading Range Screen