Buy With Both Fists?

Random Thoughts

The Ps probed a little higher but settled back to end flat on the day. This action keeps them just a smidge below all-time highs.

There was a lot more to the market on Tuesday than just the Ps. The Quack gained over ½%. This action keeps it at multi-year highs.

The Rusty was even more impressive. It tacked on nearly ¾% which is plenty enough to keep it at all-time highs.

Internally things looked pretty good. I suppose this is no big shocker with the broad based Rusty up significantly.

With notable excepts such as Real Estate and Metals & Mining aside, most areas are looking pretty good.

Selected Solar did well on Tuesday (we are long TAN).

Defense, Durable, Non-Durable, Regional Banks, Generic Drugs, Biotech, Health Service, and Transports all closed at new highs. There’s plenty more by my carpel tunnel is suggesting that you get the idea.

So, things are looking pretty good. Should we buy with both fists? Well, since the methodology requires a pullback and the indices and most sectors are right at new highs, I’m not seeing a lot of meaningful longs for this cycle (yet). On follow through and a pullback we will. When markets are banging out new highs, it’s a get ready to get ready for me. In the meantime, you want to manage existing longs. Take partial profits as offered (see Layman’s for money & position management planning) just in case the market does not follow through. On the short side, I’m still seeing a few that are setting up. Avoid getting too bearish but if you really really like a setup, then take it. See yesterday’s column for a philosophical discussion on this.

Futures are flat pre-market.

To those in the States, HAPPY THANKSGIVING! For everyone else, enjoy your Thursday.

Best of luck with your trading today!

Dave