I am using the strength from this rally to lighten up significantly on my longs. I continue to feel that we are ripe for a pullback, based on a variety of metrics. I want to add though that I am more hesitant to add here than simply to hold my existing longs.

One issue, which I highlighted in the iBC Daily Update last Friday, is the narrow leadership which I now know is best described as stems and seeds. To quote Snoop Dogg, I like my Market to be ” no stress, no seeds, no stems, no sticks. Some of that real sticky icky icky. Oooh wee!”

What would be dank is broad, expanding leadership…which we don’t have. I am running a screen in Blocks, but it will take an hour to process, so I will update this post with a picture that hopefully illustrates the lack of leadership.

Some metrics:

Buy interest, so far, is less than Fridays, and 40% as strong as last Monday’s rally. This is inconsistent with what the slow signal is saying, which is that A LOT of stocks have recovered since the late 2007 / early 2008 meltdown. How much is a lot? Well, currently, more stocks are up by my measurements than at ANY TIME IN THE LAST FEW YEARS. So the underlying fundies of the companies involved are better now than at any time since 2004-2005? It sounds dubious. But, as a proud American, I’ll bumper-sticker it and sport it around.

I will bring democracy to all of your portfolios with the iBC Machine, as will Ragin, with his Screener.

The continual lack of follow through on my daily buy strength makes me wary that all these stocks will keep their gains. I believe a sell-off will occur this week, and that ultimately it would give this rally more legs. I still am short-term bullish on the markets, but am skeptical of buying here, until the overbought readings cool, or we get some serious buy interest.