The Extended Trend Is Still Your Friend

 | Jan 08, 2018 | 4:53 PM EST
  • Comment
  • Print Print
  • Print
Stock quotes in this article:

IWM

,

FB

,

amzn

,

aapl

,

nflx

,

googl

,

tsla

,

nvda

,

anet

The market's strong momentum continue today but the action slowed and there was some choppiness particularly in small caps. The DJIA had its first negative day of the year but a strong bounce by the Russell2000 ETF (IWM) pushed breadth into positive territory after a slow start.

Most notably today it was the big cap names turn to lead.  Strength in the FAANG names -- Facebook (FB) , Amazon (AMZN) , Apple (AAPL) , Netflix (NFLX) and Alphabet (GOOGL)  -- and other big caps such as Tesla (TSLA) , NVIDA (NVDA) and Arista Networks (ANET) were the driving force.

The small-cap speculation, that has been entertaining many traders lately, was much less robust. There were quite a few fades following early strength as traders were less inclined to pursue some of the riskier names.

There isn't anyone who would question the market's need for some rest and consolidation but the more important issue is how that may occur.  The bears are hoping for a sudden collapse but that is very unlikely. What is much more likely is some choppy action and more rotation.  We had some narrowing today as the big cap names grabbed the leadership role and that may continue as increased liquidity is embraced.

There are still quite a few promising charts out there and nothing overtly negative about this market. It is simply extended and that can be corrected without a major pullback. The trend may be a little extreme but it is still our friend.

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

Columnist Conversations

Texas Instruments (TXN) announced after the close that CEO Brian Crutcher resigned due to violations of the c...
The initial upside target off the recent low comes in around the 333.51-337.71 area. Here is the updated ch...
A cup/handle is one of the strongest and most precise chart patterns out there, proven more often than not.&nb...
Today is 12 days up from the 6/28 low which is very similar to prior rallies of 11-13 days up.  This is r...

BEST IDEAS

REAL MONEY'S BEST IDEAS

News Breaks

Powered by

COLUMNIST TWEETS

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


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.

FactSet 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.