There is nothing like a big gap up open on Monday morning when so few charts are set up well technically to make things challenging. We have a very upbeat mood and breadth is very impressive with more than 4,600 gainers to just 430 decliners. All sectors except precious metals are in the green with oil and banks performing particularly well.
So far there is no indication that anyone is interested in fading this open. I suspect that too many folks are poorly positioned with insufficient long exposure and they are struggling to put some capital to work.
This is the sort of action that gave us some of those very stunning straight up, low volume, moves we have seen so often since the bottom in March 2009. The lesson is: don't be too quick to fight it. The fact that it might not seem very logical is exactly what can keep it going.
Coffee Holding (JVA), which I mentioned on Friday, is off to a good start and I'm looking to add to that. VirnetX (VHC), my stock of the week, is acting well and I'll be watching that for opportunities to trade in and out.
A very thin stock, CVD Equipment (CVV), is on my radar. This has received some recent attention as it's one of the only pure plays on an element called grapheme, which is viewed as a potential replacement from silicon. The stock is thin and very volatile, but the hot money has discovered it and it is looking poised to attempt a breakout move.