Inflation is at the highest level in 30 years, and consumer sentiment is at the lowest levels in 10 years, but that isn't stopping the market bulls.
After a quiet start, things are ramping sharply higher. Breadth improved to 4,400 gainers to 3,400 decliners and over 200 names are at new 12-month highs.
There are a couple of reasons for the strength. The first is that the negative sentiment about macro matters is helping things from becoming too extended, and buyers are finding good entry points. The second is what I discussed in my opening post this morning, which is that we have a strong speculative appetite among retail traders. Traders are in a positive mood and are looking for the next big mover. The talk about macro matters just doesn't have much impact on the folks that are trading fast-moving stocks and having a good degree of success.
Maybe we are just ignorant traders that are blithely unaware of all the terrible economic and valuation issues, but what works for me is trading the action that is in front of my face. Right now, some of that action is pretty good.
Some of the names I've been trading Friday morning include Decarbonization Plus Acquisitin Corp III (DCRC) , Marqeta (MQ) , Beyond Air (XAIR) , Merida Merger Corp I (MCMJ) , Ondas Holdings (ONDS) , Ammo Inc. (POWW) , Urban-Gro (UGRO) , Redwire (RDW) , Humacyte Inc. (HUMA) , Roblox (RBLX) , Agrify Corp. (AGFY) , and Beauty Health Co. (SKIN) .
It is a bit bumpy and volatile, that's true. But there continues to be a good supply of stocks with solid fundamentals and healthy charts. It has nothing to do with indexes are macroeconomic matters. It is just good old-fashioned stock picking, and it is working well.
Please note that due to factors including low market capitalization and/or insufficient public float, we consider some of these stocks to be small-cap or micro-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.