Economic data was on the light side today with only the ISM New York figure hitting the wires. European markets were lower in heavier trade putting pressure on futures and much of the morning session. Volume jumped above Monday’s level giving the S&P 500 another day of distribution. NASDAQ closed above its mid-point of the day escaping distribution. Given the late day surge it makes today’s distribution less worrisome, but we’ll need to see today’s low hold for this to stay true. Once again this market finds a way to stay resilient despite some heavy volume selling. Price always wins out and so far we are hanging tough. If our situations changes we adjust. For now, we remain in an uptrend.
It would not surprise us to see IBD to throw its market outlook into “uptrend under pressure” or even “market correction.” Why? The S&P 500 has had 8 distribution days in the last few weeks and historically speaking this has not been a good sign for the overall market. At this point you will need to look at your individual holdings and know where your exits are. If they are being triggered you must obey the signal. We caution folks on trying to anticipate a move by the market as it will mostly likely be an incorrect move. Stick with the plan by riding your winners and cutting your losers.
TSLA bounced nicely off its most recent lows as the stock digests its monster gains from earlier this year. The stock is likely in a basing pattern and it is anyone’s guess where it goes next. Sure, we love the cars and Consumer Reports rating of 99 is nice. However, if you followed that logic at $190 you’d be under water. You must obey entry and exits. Do not chase or trying to catch a falling knife. Wait for the signal and go with it. GOGO is another stock moving nicely today adding onto yesterday’s break out from a short stroke pattern. AAPL tacked onto its gains and cleared yesterday’s high showing the stock isn’t done moving higher. It pays to stick to a sound strategy, leaving a position too early can put you in a position to miss out on big gains. You have your exit signals to avoid serious carnage.
A decent day after we pushed off the lows. This market is certainly going to enjoy Friday’s employment report.
