We continue to see buyers race to accumulate shares as this bull market powers forward. Volume was higher on Friday indicating institutions were willing to spend their available cash. The Dow led the market higher Friday with the S&P 500 and NASDAQ not too far behind. Small caps gained, but as we have seen in the past continue to lag the broader market. While it would be nice to see small caps lead this bull market it does not appear this will be the case. Perhaps at some point, but we will continue to focus on the leaders of this market. Hanging around for laggards is no place to be if you want to outperform the stock market. As we head into the last full week of trading in November it is important to remember to stay disciplined and execute.
IWM is lagging, but the current set up does give the impression it may be gearing up for a breakout. After rallying from the 2018 lows the group has been stuck in a trading range. There have been a few times it appeared the group was either going to collapse or race higher. Bulls and bears have been in a tug of war with the group. Will this week be the week we see the entire group break free from the trading range? Time will tell, and it would be a very good sign if we were to see the group break out.
The trading public remains bullish with the AAII Bulls above 40% for the second straight week. Bears are in the mid-20s and it is no surprise given the move in the markets. Neither are at extremes just yet and it would not be a surprise if we see extremes if this move continues. If we were to see a higher percentage of bulls it does not mean, we are going to have a stock market collapse either. NAAIM exposure index dropped on the week as the market pushed higher. It will be interesting to see how we proceed this week with the Thanksgiving holiday next week.
Our focus will remain steadfast. There is no need to overcomplicate matters. Most will try, but ultimately find themselves in trouble. Keep things as simple as possible. Stay disciplined with your process and always keep your risk in check. This market will not make things easy on us, but in the end, we will win. Have a great week of trading.
