While there are plenty of comments about why it is stupid for the market to celebrate even more dovish action by the ECB, the market isn't listening. We had a little hesitating after the initial surge higher in the pre-market, but now the squeeze is back on and we are pushing to the highs of the day.
Breadth continues to run at very strong levels. That has been the situation for a couple of weeks now, as small caps have attracted speculative interest.
Gold is heating up again, a sector that tends to attract the aggressive traders. It has been moving counter to the indices lately, but that is not the case today.
The FANG names -- Action Alerts PLUS holding Facebook (FB), Growth Seeker name Amazon.com (AMZN), Netflix (NFLX) and Alphabet (GOOGL) -- are up but lagging a bit. This is mostly index-driven strength, so there isn't a lot of stand-out leadership.
There is a long line of market players that have been planning to short strength on the ECB. They are being squeezed right now, which isn't that big of a surprise. Typically, the central banker produced surges last long enough for the bulls to give it up, but eventually we see some quick reversals. I'm not sure if it will happen today or not, but I'm looking for the indices to turn. I have a ProShares UltraShort S&P500 (SDS) position that I will be looking to build slowly.
Individual stock picking remains quite challenging. I have a few odds and ends, like Integrated Electrical Services (IESC), China Customer Relations Centers (CCRC) and DRDGOLD (DRD), but timeframes are short and positions small.
What this market is all about right now is whether the central bankers can push the markets higher like they have in the past. I believe that market players are losing confidence in this game and that the turn in the indices will come sooner rather than later.