We continue to see an improvement in the NASDAQ and today’s move while not massive was certainly a step in the right direction. Volume was mixed on the session with institutions appeared to be active in NASDAQ listed stocks. We are getting quite a few breakouts here and while they are nice to see they are not coming from huge growth names. Not your typical breakouts, but we aren’t about to argue with this market. There have been far too many days from the most recent lows to count for a follow-through day. At this juncture, it would appear a follow-through day may even be a contrarian indicator. It pays to continue to stick to the plan and keep pushing forward.
Sentiment continues to be slanted towards the bulls, but it is only the II survey showing near extreme readings. NAAIM exposure index showed a big jump in short exposure with the max bearish bet being -125%. The overall index fell below 70 and landed at 68. AAII Bulls came in at 30% and bears at 26%. Those who are neutral continue to dominate the survey. II bulls ended this previous week at 57% with bears at 18%. Nothing to write home about, but it appears the market continues to keep those who respond to AAII survey far away from the market.
There are a lot of charts out there comparing this time frame to most recent market collapses most notably 2008 and 2000. Now, we only need a few market pundits to produce this year to 1987 to level it all off. We had so many trying to compare 2013 to 1929 and how did that work out? Sure, we can certainly follow prior market collapses and there is no reason to argue over it. What we do take issue is that this market must repeat a crash. If you simply follow price and its clues you will have no problem getting out of the way and taking advantage of any price movement. It even can be a crash. Pay no attention to these charts and stick to the process.
We hope you have a great long weekend and enjoy all the BBQs. Be well.
