Feels Good Right Now, But…
While
I continue to be worried about the long term for this market, shorter
term is still acting well. Keep in mind, I still believe this is one of those
“good” bear market rallies…somewhat like January and March/April
2001. Feels real good right now.Â
As I stated last week, Biotech
and Technology were sectors that should be watched
for higher action, and that’s exactly what happened. You can now add Oils
to your list of sectors that might come up the right side a little bit…so
definitely some areas to look for opportunities to exploit.Â
But… majorÂ
indices are still trading below their 200-day averages and tons of resistance
lies ahead.
You must also note thatÂ
the best moves are still mostly reserved for areas that have been trashed. This
is evidenced by the fact that even with the rally, the New
High List hasn’t even budged. The worst action can now be found in
previous leadership areas like Medical.
Now that this rally is five weeks along, it’s still important to look at support
levels. They are the same ones mentioned last week. If at any time they are
breached, then odds could favor an assault towards the lows. They are Nasdaq
1626… Dow 9080 and S&P 1055.
On the breakout front,
still not a lot of leadership that I can see. Certainly, there are a few names
popping out but nothing in group-type fashion. Strong, long-lasting bull markets
need to have major strength coming out of many sectors. Nothing doing just yet.