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  1. Home
  2. / Investing
  3. / Technology

Another Trump Slump Comes to an End

Bears keep forgetting what's propping the markets up.
By JAMES "REV SHARK" DEPORRE
Aug 22, 2017 | 10:40 AM EDT
Stocks quotes in this article: EXTR

A Trump-created market correction has come to a quick end once again. The indices are chugging away to the upside as talk of tax reform grows louder and hope of some central bankers in Jackson Hole later this week begins to grow. The political firestorm caused by Trump's comments about Charlottesville has cooled off and the lasting damage the bears were predicting didn't work out as they hoped.

It is easy to understand why so many market bears are convinced that it is just a matter of time before Trump triggers a correlation. He appears to be pathologically incapable of staying focused on policy matters. But the bears keep forgetting that the market just isn't concerned about all those things that the cable TV folks obsess over endlessly. Economic optimism is what has driven the market since Trump's election and it is still keeping a bid under the market.

While the indices are looking good I'm not finding many good entry points in individual stocks. As I mentioned in my opening post, the average stock is down so far this year and about 55% of all stocks are below their 200-day simple moving average of price. This is well hidden by the indices but if you are a trend follower it is pretty clear that there is a very small group of stocks that have momentum.

I'm a bit annoyed. I am having a hard time putting cash to work. Extreme Networks (EXTR) which is my Stock of the Week, for example, is just sitting there doing nothing on very light volume. I have a position but there isn't any reason to add to it right now.

I will continue to look for new merchandise, but, more importantly, I am not going to give the bulls room to run at this point. There is no reason to try to fade this strength at this point.

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At the time of publication, Rev was long EXTR.

TAGS: Investing | U.S. Equity | Technology | Economy | How-to | Stocks

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