The major indices, with the exception of the DJIA, have been in a trading range this month. There has been little progress primarily due to the rotation that is taking place. Early in the month, the big-cap FAANG names were leading while small-caps lagged. That reversed for a short period but then oil and retail sold off while biotechnology and some chips names outperformed.
There is enough "good" action to offset the "bad" action to keep the indices in pretty good shape overall. The Russell 2000 ETF (IWM) and Nasdaq 100 ETF (QQQ) are the worst of the bunch, but they are still holding above key resistance levels and are off the lows.
If you are just looking at the indices, there isn't too much to worry about, but if you are looking at sectors like oil or retail, it is a very different story. They have been clobbered recently but the money has flowed into other sectors that have given the bulls some ammunition and helped maintain positive sentiment.
In addition to the rotation and trading-range action, the other key theme is that there isn't any sustained reaction to news flow. There was a slight reaction to the elections in France and the U.K., the Trump political battles have generated headlines but little reaction and the Fed interest rate decision had a momentary impact on trading. The pundits keep predicting that some event is going to serve as a catalyst that causes a change in trend, but it is just hopeful thinking so far.
None of these conditions is inherently negative for trading. In fact, rotation within a trading range is often a good thing for traders, but the stock picking has been challenging. I am not seeing traders act very aggressively. They are looking for entries and may catch a thing or two, but there isn't much talk about building positions and riding trends. They may not be bearish but they are cautious and that helps to maintain the trading range.
Once again, I am doing very little. My trades are very minor as I continue to look for something I can add. My Stock of the Week, Everspin (MRAM) , continues to run higher but I don't see many other names acting like this one.