LONDON Jan 30 Technically overbought markets
and investors keen not to miss out on further gains have left
European indexes in a delicate position ahead of the Federal
Reserve meeting and jobs data in the United States on Wednesday.
By 0802 GMT, the FTSEurofirst was down 0.75 points,
at 1,177.04, having slowly inched near to highs hit in
mid-February 2011 over the previous few sessions.
But with most major European indexes now in overbought
territory some investors are starting to question when a
correction will happen.
"Indexes are at overbought levels and yet there has been no
pullback. A fall of 1-1.5 percent may be all that we get heading
into the new month and the real correction may not happen until
March (echoing the pullback in 2012)," Jawaid Afsar, a sales
trader at Securequity, said.
He said while overall the "trend is your friend" there are
two catalysts in the next couple of sessions -- the update from
the Fed and U.S. jobs data on Friday -- which could have an
impact on market, and Afsar recommended short-selling index
futures around the data if only to unwind the overbought state
of the market.