A day of digestion as the market rests on support provided by a ‘positive’ earnings season and a FED that gives and gives. Most of the incremental gains for the market today are due to managers going after the lagging groups as is always the case. Thus, leading sectors in the market today are the Black Sheep groups, while the Nasdaq lags. This also relates to a note a few days ago…”.bring inflows from the sidelines due to technical (indicies potential breakout)..” . Combined, it is all ‘PA’, performance anxiety into month end. If the breakout the other day isn’t enough, today the TRANS were making fresh highs, which garners support from the Dow Theory cult.
Another quiet day tomorrow likely, next week as discussed we will find how long the market can rest on it’s laurels. (earnings / FED). There is no sign of shorts in the market and it’s hard for the market to go much higher without them being around to get squeezed. The market would need a lot of money to come in the market to offset their absence. Maybe, eco data will wake them up next week and/or wake up complacent longs. Recall, what we said about April PMI's (tagged) showing what March PMI's didn't ( post Japan/Crude price escalation).
Considering, DJIM has always been an earnings/small cap orientated place, we still have something to look for as R2K earnings take over from the mega caps. If today is any indication from Shadowlist (tagged to locate) earning linked plays, we’ll have something to look forward to and initiate new stocks. CRR, initiated last Q at $110, hit $169 today, SFLY, also last Q addition at $40 to $67 today and FTNT from August at $18 to $48. All were >15% pops today off another round of excellent earnings. Makes you wish you were just a buy and hold investor....
Demi/ YourPersonalTrader
Nice earnings from small caps, QLIK play here and others like ACOM (now at of hand), ARBA , but one we played as an IPO in software Netsuite is best, N, headline is nothing # special, but inside is great 'billings growth') and definitely an add to Shadowlist.