All the major indices are hitting new all-time highs and breadth is running very strong once again -- at better than 2 to 1 positive. We have 688 stocks hitting new 12-month highs as I write, and only 62 at 12-month lows.
Many bulls are growing nervous about this one-sided action, but this is what momentum looks like. It is very easy to overthink it, rather than just hitch a ride. There are many things extended and they are only becoming more extended.
One group in particular that is extended and is still running is steel -- as you can see with the VanEck Vectors Steel ETF (SLX) . Merrill Lynch was positive on the group today and that is sending it even higher. The driving force for the group is that carbon steel makers, like AK Steel (AKS) , US Steel (X) and Steel Dynamics (STLD) , are benefiting from the possibility of infrastructure spending as well as supply cuts due to changes in trade deals. I've added to AKS today, and also have an eye on Brazilian steel play Companhia Siderúrgica Nacional (SID) .
The oil sector failed to follow through on yesterday's strength, but I'm maintaining positions and giving the group a bit more room. Comstock Resources (CRK) is my top oil play at the moment. Semiconductors have perked up and the FANG names -- Growth Seeker holding Amazon (AMZN) in particular -- are helping to keep the indices moving.
It is holiday trading, but the momentum is slowing a little and it is important to manage positions very closely. Don't become too caught up in the emotion.