The bears had a good opportunity this morning to press when stocks gapped down on gloomy news about more Covid-19 cases, the lack of fiscal stimulus, and the downfall of the mighty Fastly (FSLY) , but they have been able to close the deal.
As is so often the case, the bears can't seem to gain much traction, even when they have favorable conditions. There is still plenty of room for stocks to correct after the big recent run, but the stock pickers are still busy, and dip buyers are suffering from premature accumulation.
The longer stocks continue to hold up this well, the greater the chances that a bout of FOMO will flare up.
The longer stocks continue to hold up this well, the greater the chances that a bout of FOMO (Fear of Missing Out) will flare up. The dip buyers have not been trapped recently, so they are still feeling quite confident about putting cash quickly to work.
I've been repetitive on this point for a while, but, to me, it is the key to the market action. Market players are still very focused on stock picking and we are not seeing the correlated selling that occurs when downtrends gain traction. The character of the market action is still quite bullish, even though there are some technical issues.
The S&P 500 is hovering near the highs of the day and the longer it holds, the more likely the buyers will continue to put cash to work.