Friday’s disappointing jobs report could not slow down this market’s uptrend. Let’s face it this economy is not about to return to high growth where jobs are abundant. This market continues to defy the naysayers and we continue to find strong stocks. Most of subscribers have been fully invested for a few weeks and have been reaping the rewards. Volume was lower today as most Monday has continue to see light volume. Small caps were the biggest winners on the session. Lagging was the NASDAQ 100 as big cap technology stocks were left behind today. Not much to get worked up over and we will continue to manage this uptrend with heavy long exposure. We have our exits in place and will continue to manage risk properly. A solid start to this week.
What is impressive is we continue to see daily volatility as measured by Average True Range continue to shrink. At market tops we typically see volatlity expand while making very little headway. At the moment we continue to see tight daily action and we continue to see positive price action. Not much to really dislike about this market. Sure, we could see bigger price percentage winners. However, at this point we have solid charts and continue to have positive action out of our names. So much for “sell in May and go away.” We would prefer to stick with price action and ignore the hype and noise.
Janet Yellen made another speech today and again the market really did not care. The Federal Reserve is trapped and appear to be losing control. Economic data cotinues to be weak and there really isn’t signs of growth anywhere. This market completely ignores all of this and pushes higher. The S&P 500 trades at more than 19.5x trailing twelve month earnings. It simply does not matter! As long as central banks support low rates and QE globally there is no reason to think this market can’t keep going higher.
Nice start to the week.
