Investors managed to keep the rally alive last week despite several key banks being told they had to raise more capital. After the government’s stress test results, 10 of the nation’s 19 biggest banks were told to pony up.

Here's a summary of each bank and how much capital they need to raise;

American Express: none needed
Bank of America: $33.9 billion
BB&T Corporation: none needed
Bank of New York Mellon: none needed
Capital One Financial: none needed
Citigroup: $5.5 billion
Fifth Third Bancorp: $1.1 billion
GMAC: $11.5 billion
Goldman Sachs: none needed
JPMorgan: none needed
KeyCorp: $1.8 billion
MetLife: none needed
Morgan Stanley: $1.8 billion
PNC Financial: $0.6 billion
Regions Financial: $2.5 billion
State Street: none needed
SunTrust Banks: $2.2 billion
U.S. Bancorp: none needed
Wells Fargo: $13.7 billion

In addition to the stress test, the nations unemployment rate hit 8.9%, but the employment report came in better than many had expected.

The current rally is repricing stocks for a recession instead of a depression. The media pounded the airwaves with the dreaded "D" word to keep you from buying stocks. While many investors were running for the exits, I'm sure some very rich (in the know) people were buying at unbelievable prices.

Currently, the stock market is very overbought, and the momentum indicators defined in the Relative Strength (RSI) numbers warrants caution.

Relative Strength (RSI) measures a stock as overbought/ overextended if its RSI is around 70. A stock that is oversold usually has a RSI of around 30. Many stocks today have RSI numbers ranging from the mid 60's to the mid 80's. I am not interested in participating in the buying frenzy when these numbers reach such lofty levels.

Here is a list of on some hot tech names that have extreme overbought RSI numbers;

AAPL= 82.67/ 82.58
RIMM= 78.38/ 79.49
GOOG= 73.28/ 75.34

Traders that own positions in these stocks may want to consider selling or sell puts or covered calls on their positions.

Here are a few overextended Dow stocks;

BA= 75.86/ 64.83
AA= 77.35/67.45
AXP= 75.67/76.79
CAT= 83.62/69.08
DD= 70.60/75.24
DIS= 80.13/71.87
IBM= 73.51/72.34
HPQ= 69.73/68.31
INTC= 73.28/68.61
MMM= 76.25/67.54
T= 72.86/ 63.20
UTX= 73.45/70.82

We took some money off the table last week in preparation for a correction based on the extreme overbought condition.