A positive new home sales figure helped lift stocks to their highs, but they wouldn’t be able to sustain the new highs. NASDAQ volume was lower on the session as volume on the NYSE was higher on the day. Despite the lack of excitement in the overall markets we did see quite a bit of underlying strength with leaders. Let’s be honest today was quite a boring day if you sat in front of your computer! Boring days are good for the market especially when we are consolidating big gains. There still isn’t enough evidence to be calling a top as we see many traders continue to do. Our uptrend remains intact and until we receive price confirmation we remain long.
It would be nice for the market to run higher into new highs after these two days of quiet trade. Uptrends will certainly play tricks on folks by fooling them into thinking the top is in. It simply could be trader and investors think they are smarter and know when the market has topped. Unfortunately, you or anyone is not smart enough to pinpoint price highs. Gurus will tell you they have timed the market perfectly and we would see this as a scam. Even with those who claim 99% of their picks are positive. We get a good laugh, but it reinforces the need to have a sound process. Follow the trend (price) and have a risk management process. It sounds simple enough and it is. Implementing the strategy and sticking with it is the most difficult part.
We have our stocks moving quite nicely despite the overall market running in place. Stocks like PHM and KBH continue to highlight simply following a trend is a powerful path to follow. Stick with the leading stocks and you will outperform the majority out there! Of course we are here to help.
Stick with your winners and shed those losers.
