http://stockcharts.com/h-sc/ui?s=$bpspx this reading above 70 represents that 70% of stocks within the index are above their 50 day moving average. this shows overbought conditions....
but what does overbought MEAN? RSI over 70 is also an indication of "overbought". great. does that mean it can't stay "overbought" for a given # more of minutes, days, weeks, months? of course it can. so, even if one agrees and says "yes, it's overbought" what exactly does that conclusion lead you to believe is a proper trade strategy?
Yes it was overbrought since Sept. but the prices still climbed another 20 points. About 40%.....thats the reason you should take indicators with grain of salt.