A weak housing report showing a 14.6% fall in housing starts helped send stocks lower to start the day, but as the day wore on stocks worked their way higher finishing well off the lows of the day. The DJIA and the SP 500 finished higher, making it six days in a row. The Nasdaq finally had a downtick and ended a five session win streak.
At the close, the DJIA gained .3%, the SP 500 rallied .1%, the Nasdaq fell .1%, and the SP 600 fell .3%. Leading stocks finished the day positive, with the IBD 100 up .1%. The other important piece of data is that the Nasdaq closed at its high of the day. This shows you the strength of this market. The Nasdaq falls yet can't stay down.
Volume came in much lower on the Nasdaq and the NYSE as traders, once again, took another early leave for a long weekend. The lower volume on the Nasdaq's pullback is a good thing to see in a bullish market. Gains on higher volume during an uptrend and losses on lower volume is just what you want to see in a strong market.
Even with the gains on the DJIA, breadth was negative with decliners beating advancers by a 6-to-5 margin. The breadth on the Nasdaq had losers beating winners by a 3-to-2 margin.
For the week the Nasdaq rallied an impressive 2.3%, the SP 600 rallied 2.1%, the DJIA rallied 1.9%, and the SP 500 rallied 1.5%. All of the major indexes hit all-time highs or five year plus highs. The SP 600 almost hit all-time highs. It was but a mere 2 points away. I am not sure what the heck you can find bearish in that.
The good from the week has to be the pure strength of the rally. Leading stocks, big caps, small caps, and my stocks are all acting extremely well and producing good gains. The rally has been very broad with the most obvious of the strength being in the amount of new highs. As IBD pointed out in "the Big Picture" column, on Wednesday, the Nasdaq had 290 new highs. That was the highest amount during the uptrend. On Thursday, there were a total of 194 new highs compared to 15 new lows, and on Friday it was 291 new highs to 46 new lows, on both exchanges. This shows that this rally is very broad and involves many stocks in many diverse sectors.
The best sector move with the most exciting stocks in them is the sector I brought up a month ago which nobody was talking about. Medical-Biotech; it has gone from 141 to #10 on the IBD Industry Group list for price performance the past three months. This sector is offering tons of stocks that are producing large gains very quickly. Also seeing the move in Airlines, Computer Networking, Chemicals-Fertilizers, Media-Periodicals, Internet-Network Solutions, and Computer Software-Enterprise show the pure broadth strength of this rally.
The other good news has to be in oil. Since its peak in July, it is down 30%. This coincides nicely with the rally we have had off of the June lows. It is hard to not see how this has to be somewhat, psychologically, correlated.
The bad news is that the market is heading toward maximum overbought on many different oscillators (Arms, 10 dma overb/overs, and McClellan). However, like I keep saying over and over, momentum is a hard beast to tame once it is let loose. The market can run to the upside and the downside faster and for longer than you think it can.
Until this market rolls over, continue to play the upside and let the bears keep making fools of themselves. They will get it right, one day. Until then, they will continue to constantly lose money. Then when they get it right they will tell you, "I told you so." Nice, moron, too bad you lost 29% before you made 25%. This is how most short sellers do it. Trust me, I have NEVER met a successful pessimist who ONLY shorts the market for a living. They may be out there but I have seen and made way more money on the long side to ever want to live that pathetic life.
Aloha and I will see you at Investors Paradise. Have a great weekend.
New Swing Longs: FMCN ADL HOTJ
Adding To Holdings: PTT OME
Longs Up On The Day (low vol non-IBD excluded): JST-45 ICE-32 OMTR-50 SVNT-69 HRZ-65 CPA-46 PRFT-27 SEIC-25 PSPT-36 INWK-53 TYL-51 AKAM-208 AMAG-38 ALTH-77 AUXL-63 IMA-25 BAM-50 HRT NSTC FFH IGLD PCCC AOI ISE ACTU LNET ACGL SUAI CELG TRT INAP RJET BMC HCSG AHS MSTR DUCK VCLK WEL EVR EVEP ULTR CVLT ICFI CBF AWH MRB INPC ISIS SFL WSH GSL TSG ALXN CCO NU KO PNW PTT PRCP OME GENT GMTC ZILG RMKR
Stocks On Watchlist: ATNI BIIB INDH AVT MAMA TKLC TWTI DWA MEDX XIDE KAR HSIC PMID BUF LXU
Cut All Your Losses/Take All Your Profits: None
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