Today was a solid day for the market as we saw the NASDAQ jump more than one percent, but it was small cap stocks leading the overall market that was most impressive. The VIX dropped more than 5% as complacency continues. There simply isn’t any fear over the market moving lower. Financials had a big day as the lagging group has sprung to life as of late. One negative on the day was the S&P 500 and NASDAQ failed to hit their next round number 1800 and 4000 respectively. The Dow Jones Industrial Average closed about 16,000 for the first time ever. It appears the market has shrugged off the possibility of a taper and resumed its move higher.
Sentiment among those who would call themselves market professionals continue to be bullish. II Bears continue to sit at multi-year lows and the NAAIM survey remains in bullish territory. It really isn’t surprising with the Federal Reserve’s QE and BTFD mentality professionals are bullish. On the other hand, the non-professionals responding to the AAII survey are pretty much mixed. Bulls stand at 34% while bears sit at 29%. Interesting, but we’ll see how this plays out through the year-end. Speaking of year end receive a 40% discount off the platinum service using the code: YEAREND. Get on board.
Financials continue to shine led by BAC and others. We have, in the chat room have been pointing out for over a week now stocks like JPM, BAC, MS, WFC and others. Whatever the “reason” for the move they are moving. Last week we simply were following price action and today’s move simply confirms it pays to follow price. If we had ignored our signal we would have missed out on some nice gains. Never ignore a signal, ever.
Have a great weekend and enjoy tomorrow’s option expiry.
