The market is off to a slow start this morning, but that has not mattered much in 2017. The most consistent theme of the year is afternoon strength. There was only one day so far in 2017 on which the market did not rally late in the day, and that was on Jan. 9 -- it was more flat than down.
This consistent pattern is driven by computer algorithms. You might think they would be a bit more subtle than doing the same thing day after day, but it is the consistency that trips up market players that keep trying to anticipate a change in pattern.
Traders used to focus on simply staying one step ahead of each other, but now they have to go several levels deep if they want to analyze market psychology. If afternoon strength is too obvious, then the pattern has to end -- but if too many people think the pattern has to end, then it will continue.
It will be very interesting to see today if the afternoon strength occurs once again. We are seeking some dip buying action as a I write, but breadth is about 2 to 1 negative and bulls are pleased to finally see even a minor pause.
I have raised quite a bit of cash recently, and have not had been putting much of it back to work. I mentioned Sarepta Therapeutics (SRPT) as a bottom fish candidate not long ago -- and it is finally showing some signs of turning up. Star Bulk Carriers (SBLK) is showing signs of gaining momentum as it breaks out of a base. Advanced Micro (AMD) may be a bit extended here, but it is one I think will set up well for more upside down the road. Global Blood Therapeutics (GBT) has been a huge winner recently, and took advantage by pricing a secondary offing at $24.50. I will be looking to rebuild my position as this develops.