Rally Doesn't Generate Much Excitement

 | Jun 19, 2017 | 1:42 PM EDT
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The indices have held up very well and are trading at the highs of the day as I write. Breadth has steadily improved and is running 4,500 advancers to 2,150 decliners and there are nearly 450 stocks hitting new 12-month highs.

This action is a good example of why it is so difficult and frustrating for the bears who keep trying to call market tops. There isn't any specific news reason for the buying. While the election in France is receiving most of the credit, the recent bearish arguments have not been negated. The Fed is still hawkish, the Trump agenda is still stalled and valuations have not become cheaper.

The main reason the market is up is because the buyers made a stand and there is more fear of being left behind than there is fear of being caught at a turning point. It simply has not paid to anticipate any weakness.

What I find of particular interest is that rallies of this sort generate so little enthusiasm among individual traders. There is no celebration of the upside because market players are struggling to keep pace. They can't keep pace with lopsided action when there aren't any ups and downs. If you try to trade what little volatility there is, you end up on the sidelines with cash.

My goal as a trader is to stay open minded and to react to the price action. I would prefer some downside, but I can't let my desire color my thinking. However, even though I'm prepared to embrace the positive action, it is still quite difficult to find the best trading vehicles. Even though I want to buy, it is very challenging finding a specific stock to buy.

That is why there is so little excitement over a market that is trending higher and making new highs. The idea of buying sounds good and existing positions are working well, but putting new cash to work is frustrating and that makes the strong market far less attractive.

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