The Bears Keep Trying

 | Feb 07, 2013 | 4:29 PM EST  | Comments
  • Comment
  • Print Print
  • Print

There was an impressive bounce after a very weak open and the market even managed to close strongly, though not quite at the highs. Late news from Apple (AAPL) about its plan to distribute some of its massive cash holdings helped hold the market up late in the day.

Despite the bounce, breadth was weak and plenty of stocks struggled. What was most impressive about the action, though, was the large number of stocks that hit new 12-month highs. About 350 stocks hit highs and only about 25 were at the lows. Many of the stocks hitting new highs are doing so with vigor, and the hot money is still eager to chase. It isn't all small-caps, either: American Express (AXP), Google (GOOG), Citigroup (C), FedEx (FDX) and Schwab (SCHW) are on the new highs list as well.

When you have that sort of momentum in individual stocks, the market has a greater tendency to stay sticky to the upside. As I've mentioned many times, markets and stocks at their highs don't suddenly reverse and go straight down. It takes time for a top to form and I am still hesitant to say a topping process has started.

When a market has this sort of underlying support, we can't be too bearish. If the number of new highs declines sharply accompanied by weak closes, I'll be very happy to take a bearish stance -- but it isn't happening yet. The bears are being teased with some negatives, but if they act too fast, they will get hurt. While there hasn't been much upside progress lately, there's even less downside progress. The bulls still have the edge, although the bears are trying harder lately.

Have a good evening. I'll see you tomorrow.

Columnist Conversations

Keep an eye on Wayfair, which recently filed for its IPO. Killing it on pricing in home goods head/head with W...
Is this the biotech revolution or the biotech bust? View Small Cap Biotechs Like Never Before: Transparency is...
HLF is trading $51.05, up 3.2% with IV30™ ripping up 21.5%. The Symbol Summary is included below. Concl...
With just less than an hour til the close of trading the S&P 500 is trading nearly 4 points off of that 2,...

BEST IDEAS

REAL MONEY'S BEST IDEAS

Columnist Tweets

BROKERAGE PARTNERS

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.


TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.