Still Overbought?

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 |  Includes: IVV, IYZ, SPY, XLB, XLE, XLF, XLI, XLK, XLP, XLU, XLV, XLY
by: Bespoke Investment Group

You would think that the next stop is the March lows with all the talk about today's sell-off. To put things into perspective, however, the S&P 500 finished the day down less than 1%, and based on its 50-day moving average spread, the index is actually still trading at the upper end of its trading range.

As shown in the chart below, which we update daily in our Morning Lineup, the S&P 500 has been and continues to be in overbought territory.

click to enlarge

Each morning, we also update where sectors are trading with respect to their trading ranges. In the chart below, the circles represent where the sector is currently trading with respect to its trading range (white area is neutral, pink and red areas are overbought, and green areas are oversold), while the tail shows where the sector was one week ago.

As shown, there are currently no sectors that are oversold. In fact, five of the ten sectors (Energy, Materials, Technology, Telecom Services, and Utilities) are still overbought. While the remaining five are within their normal ranges, three of them (Consumer Discretionary, Health Care, and Industrials) are near the upper end of their ranges.