Path of Least Resistance is Up

All three major indices closed out the week at breakout levels. Regardless of whether or not the intraday or daily charts are showing signs of being overbought, they are far from it on a weekly basis. Understand that in technical analysis the longer time frame is most often given precedence over lesser time frames. Overbought conditions can remain overbought for long periods of time in a trending market. They can also work themselves off by sideways consolidation. Since we are looking at weekly breakouts here overbought oscillators must be interpreted as complimentary to the trend and not as an indication that reversal is imminent (as would be the case in a ranging market).