The market built on yesterday's extremely powerful momentum but it was much more mixed action and the S&P 500 had the weakest last hour action in a while. There was still plenty of green on the screens with breadth of 4,400 gainers to 2,800 decliners, but this is the first time the S&P 500 ETF (SPY) has closed near the lows since January 3.
Most notable today was some strong speculative action in low-priced "junk" names like Electrameccanica Vehicles (SOLO) and Uxin (UXIN) . Some market players believe that movement in those sorts of stocks occur late in the cycle but that tends to be more wishful thinking that anything else.
I am still concerned that the move over the 200-day simple moving average may be a failed breakout. But even if there is a pullback at this point I am looking for trading range action to occur rather than a collapse.
I continue to like the stock picking in this market but you have to be selective and manage trades carefully. The big movers yesterday like Pyxus (PYX) and Qutoutiao (QTT) gave some back today but that is to be expected when gains are that big.
It is understandable that the bears are growling about a possible top but there are still no signs of it yet in the price action. Some downside at this point would actually be a positive as it would help to set up more charts for another run-up.
Stay focused on what is happening right now and don't be in a rush to anticipate disaster. Make money while you can and play defense only when you need to.
Have a good evening. I'll see you tomorrow.