The general stock market indexes made it five in a row on Thursday. The news that helped spur this rally could have been the 4% drop in oil, the tame retail-inflation data, or the rebound in manufacturing activity. No matter what the real reason was the only thing we need to know is that stocks advanced again but this time did it on lower volume. A pullback should be expected soon. Don't let it take you by surprise.
At the close, the DJIA rallied .4%, the SP 500 rose .2%, the Nasdaq rallied .3%, and the SP 600 decided to go the other direction with a .3% loss. Leading stocks also lost ground as the IBD 100 fell .2%.
Volume was just a tad lower today on the NYSE and the Nasdaq. Breadth was positive on the NYSE with winners beating decliners by a 6-to-5 margin and on the Nasdaq advancers pretty much match decliners.
This advance has been very strong but it might be losing some momentum as small cap and leading stocks fell. The SP 600 has been leading recently and with it showing a loss today and the other indexes rallying we might be seeing the first signs of a short term top trying to create itself. However, this is all speculation and trying to guess what the market is going to do has NEVER made me money. The trend is still up and that is all I need to know.
The one thing that I can not help but to comment on is oil. Oil fell 4% today. I can only assume it was because GWB and his chronies are dropping the price so they can win the mid-term elections. Oh! Wait. They are over. And oil is dropping? But what about the far-left's conspiracy theory? I guess supply and demand is really all that matters, after all. Or maybe the Democrats are lowering oil so more people will join their party now that they have control of Congress. Is that a UFO flying over my building?
Back to the market. Nothing has changed since the rally started five days ago. Leading stocks and stocks in my portfolio are doing much better than at the beginning of the rally. My protfolio has outperformed the market by quite a decent amount during the past five days. The other deciding factor in showing how powerful this rally has been is the fact that the past four days I have only had to dump four stocks. That along with the twenty plus I have taken has to be one of the highest ratios of new buys to complete sells I have seen since 2003.
Until the market actually shows us the top, it is stupid to try to predict where this run will end. It is indeed getting very frothy up here but nobody says that more foam can not pour out of this cup. I don't have that much to add. The status quo the past five days has been working and continues to until it does not.
Until we actually get a pullback, stay the course. If you have been left behind on this rally, you need to review your decision and see what caused you to miss it. If it is because you listened or watched too much TV then maybe you should turn all the bullshit on CNBC off.
Do you realize I NEVER watch CNBC. I prefer ESPN, ESPN2, FoxSports, Comedy Central, MTV, MTV2, or a DVD. So take that as you want. While you get paralyzed from all the BS commentary on CNBC, I will be laughing my arse off at the next Stephen Colbert skit.
Aloha and I will see you at Investors Paradise.
New Swing Longs: SKX SPRT KO
Adding To Holdings: PTT
Longs Up On The Day (low vol non-IBD excluded): AOB-80 CPA-43 AKAM-208 DKS-34 PSPT-35 INWK-53 IMKTA-26 CXW-38 IHS-86 RMTR-45 FCSE-38 SOFO-68 STEC-38 TTEC-55 ALTH-71 BRLC-83 REGN-43 MIKR IGLD UAUA INAP TRT IAAC PCBK UCTT JST NSTC LMT SEIC ACGL BOT TSRA BEBE APLX CELG FFH MVSN COH DUCK AHS HMSY EXLS EVR EVEP CVLT TRBN AWH ICFI SAI ALXN QD AXTI AOI AMAG NHP ANAD NU SCI ETR NWL INPC MRB AYE RENT PSMT ACP RIV PTT SUAI
Stocks On Watchlist: MAXY SFP PRGX TWTI DWA ELOY FSI
Cut All Your Losses/Take All Your Profits: BEAS
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