What Else is New? The Bears are Wrong!
Two whole days of consolidation. In modern terms, that sounds like a correction! Of course, I am kidding as pullbacks have been few and far between lately, not to mention shallow and brief. The Dow and the S&P 500 are digesting in textbook fashion with the S&P 400 and Russell 2000 still not behaving the way I would like. The former is starting to show very early signs of leading, but we have been down this road before. The NASDAQ 100 continues to march to its own beat and resemble 1999 more than anything else. But before you ask, the answer is NO. I do not believe we will see a similar outcome to the Dotcom bubble implosion.
Semis, software, discretionary, industrials, materials, healthcare, staples and utilities are all at or close to new highs and either leading or behaving very well. So much for the bearish pundits who opine that the rally is “narrow”. It is also great to see the transports moving higher and trying to to lead again. With high yield bonds and the NYSE A/D Line just short of all-time highs, it’s hard to see anything more than routine and healthy pullbacks.
Thursday is set up for a plethora of news with Comey’s testimony, the ECB meeting and the election in the UK. I am going to go out on a limb and say that whatever the news is, the markets won’t really care. The bull market isn’t over. This rally isn’t over. My next upside target of Dow 23,000 remains. Don’t overthink this.
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