Whether last night's pivot points were correct or not is now a moot point, as we have blown past anything that can be considered resistance for the near term. Volume is now on the increase, and the big money boys might finally have decided to get into this market. The trend since October 4th is now decidedly up, with absolutely no signs of distribution- I mean, none. So for now, despite my severe distrust, the "go long" green light is still on.
The Nasdaq 100 has now re-asserted leadership. With AAPL at a new high and the semiconductors finally getting off the floor, all is well in tech land. Well, maybe not.. We seem to be pricing in spectacular earnings for the next couple of weeks, and I don;t think we will get them. But that will have to wait.
Just as the Nasdaq gets into gear, the Russell 2000 is going back to sleep. While this looks like it is going higher, it will have to go higher a little faster to get me into the bull camp.
Another thing that is keeping me just outside the bull camp is the percentage of stocks above the 50dma. Here on the NYSE we are now at a point where we should reverse, and pretty soon. Historically (the last 10 years) this does not spend more than a couple of weeks above 75. However, since it is still moving up, it appears to be safe to be long. For now.
The same indicator on the Nasdaq, playing catch up. I have not seen a divergence between the two like this before, so it is hard to say which one will crack first, but this could in theory move up for at least a week or so before getting severely overbought. When one reverses, the other will as well, but with the difference between the two, it is going to make trying to time the reversal that much more difficult. But, I will be watching for it.
For a chronically depressed perma bear like me, this rally is certainly befuddling, but I have learned not to argue with them. The trend is up, and there arre very few signs of an imminent reversal, so long it is, for now.
I will have the new highs update shortly.
