Good morning. The Nasdaq is currently trading at a new all time record high. Overall the stock market continues to grind to fresh highs on seemingly a daily basis. Volatility readings remain at their lowest levels since the great calm that surrounded the rounded rock boom of 12,000 b.c.
The market will correct at some point? Right?
Of course marketwatch is out with another fear mongering headline...
It turns the big crash everyone has been looking for since 2009, is going to be just a pile-up of 10 speed bicycles..... PHEW!!!
Charts continue to trend higher. $SPY, $QQQ, $DIA all making new highs. The VIX remains muted. The old adage 'Don't short a dull market' remains at play.
Earnings are coming into focus. Financials have reported strong headline numbers, which the market has used to take some profits. However I think the big names like $JPM $GS $BAC and $C are all heading higher over the short to medium term. I know saying something is going higher in a market that has been trending higher is the easy call. But again.... why fight it.
Financial EFT $XLF has broken out to new record highs, breaking a previous resistance point it was rejected at over 10 years ago. I think financials are going to take the baton and run this market to continued fresh record highs.
An inverted financial crisis if you will:
Until the narrative changes in the market, meaning higher volatility readings, and a loud market. Right now the quiet market means stocks are going to continue to grind higher. I will trade for that $100 break of $JPM via calls. I think $GS is going back over $250 and $C will break $75.
With the lack of movement and a post earnings premium crush, a name like $GS that was beaten down over 2% yesterday on earnings, will make for a nice recovery trade into weeks end. I will also look to trade out into November for more financial upside.
Tech names continue to grind higher as well. Look at $FB, busting out to a new all time high and out of the bull flag. $200 before year end?
Small caps continue to flag:
$QQQ continues to move off that wedge break
and $XLF looks strong after breaking long term resistance:
See you in the chat room - Have a great day.