Traders returned to their desk in a buying mood, following a long holiday weekend, picking up where they left off last week. In a day where leading stocks, small-caps, and technology led, the market managed gains across the board.
At the close the SP 600 rallied 1.1%, the Nasdaq 1%, the Dow Jones Industrial Average .8%, and the SP 500 .7%. The best news of the day came in the form of the IBD 100. That index rallied 1.4%, leading the other averages. That is what you want to see in a strong market. It is late but better late than never.
Volume was much higher on the NYSE and the Nasdaq, as was to be expected coming off a pre-holiday trading session. However, at the close volume was still well below average on the NYSE and just barely made it over the 50 day volume average on the Nasdaq. Breadth was positive with advancers over decliners by a 9-to-7 margin on the NYSE and by a 3-to-2 margin on the Nasdaq.
This market appears bullish on the short-term as leading stocks have now decided to join this rally. That along with a lot of different sectors joining on the gains today makes for a bullish tape. The Internet, Financial, Oil, Metals, Retail, and Semiconductor Sectors all saw good gains.
However, how I feel on the long-term has not changed after today. I have gone over every single bearish reason I can on the market, over and over, here and at Investors Paradise. If you go over the last five to six post on this blog and take some time to read some of the 'General Market Observations' and 'General Market Questions' comments left by extremely knowledgeable readers, you will see why there is plenty of reason to not trust this rally. I am still keeping all new buys small, unless they are in the Medical field. Those charts are very pretty and they are all holding up after purchases so I feel comfortable buying a little more of those stocks. If they are not Medical and/or in an Industry with an A- or better rating at IBD, I would seriously question why you want to go long these stocks.
I am a trader. I have to trade. It does a little extra damage in markets that are whippy like the one we are having but by sticking to my method I am ALWAYS invested in the next bull market before it starts and can roll those profits into better charts as they appear. I still don't think we are ready for one of those big rallies like 2003 any time soon. Tradeable rallies: yes; big giant bull market: no.
I hope you enjoyed your long weekend and were ready for today. I am sure there will PLENTY of fireworks to come in the upcoming days and weeks. I will see you at Investors Paradise. Aloha!!
New Swing Longs: DKS ACGL CUP ZTM AIQ LYG
Adding To Position: ALTH
Longs Outperforming (low vol non-IBD excluded): CVO-141 AKAM-157 KNOL-156 Q-91 CTCI-64 SYKE-40 TYL-39 BTJ-26 GROW HSR NEU BW IMKTA AHS TTEC ALY KAI WEBX NITE ABCB IDXX ORB PRFT IIVI ISYS BMC MWRK INWK CGX HCSG TRMB BMR VTIV SEIC GISX RNST DUCK BEBE EGN LMT BRR MA ALTH MNG MEH VC ABMD STEC NU WGA
Shorts Outperforming: GTRC-19 IYT WERN XPRSA NCI EXBD FDX CCO KMP
Completely Cover Shorts: RES AME HCBK FRC X ATPG NC STNR CBD
Stocks On Radar: CHAP MVSN SIMG MOLX INPH XING VMI ICOC HERO AXE PLC NXG PLM ABB FSL GNA TIVO
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