The dip buyers wasted no time jumping on early weakness but this was mainly big cap and index-driving bounce action. Breadth is close to 2 to 1 negative with the Russell 2000 ETF (IWM) lagging and the Nasdaq 100 ETF (QQQ) leading. Speculative action continues to slow with fewer than a dozen stocks on my 10% gainers list.
One aspect of this market that is providing support is the resurgence of the retail trader. These traders tend to be stock pickers rather than market timers. They view dips as trading opportunities rather than a reason to worry. They keep providing support because they like the opportunities they see.
I'm staying very watchful of overall market conditions. I'm concerned about breadth, and as I've already stated, if we start seeing 3 to 1 negative breadth then I'll be very concerned. Technically the bears need to take out the opening lows if they are going to gain some respect.
In the meanwhile I'm acting trading individual stocks. Xeris Pharmaceuticals (XERS) , which was a recent Stock of the Week, continues to move nicely higher and I'm riding it as best I can. I took advantage of another dip in Sangamo Therapeutics (SGMO) to add there, and I'm developing a new position in recent IPO, Flux Power (FLUX) .
As long as stock picking remains good and breadth doesn't become too negative I'll maintain a bullish bias, however there are some reasons to worry.
