I hope if you had any illusion that the either/or market had gone away, on Wednesday you were given proof it is still alive and kicking.
Big-cap tech rallied and so much else sat it out. We'll start with breadth, because it was essentially the same as it was on Tuesday. But Tuesday the S&P was up 30 points and Wednesday, it was up 53 points. So breadth was nothing to write home about.
But you know what was truly worth highlighting? Upside volume on the New York Stock Exchange was 51%, and that was because I rounded up. Let me repeat what I have said for months: When the big- or mega-cap tech stocks enjoy the rally, almost everything else has to take a back seat. They just take up too much room to allow much else to join the party.
Even on Nasdaq, where the index gained 260 points, upside volume was a mere 60%. And remember most of those big-cap tech stocks trade on Nasdaq. I can assure you that 60% upside volume on a day Nasdaq tacks on 2% is not good. Although, I grant you we have seen worse, because there were times we saw it negative, so at least it's still leaning positive.
Then there are the number of stocks making new highs. Back on Jan. 6, the NYSE saw 375 new highs. On Wednesday there were 230 new highs. So, if you're wondering why it didn't feel as good as the indexes looked, this is why.
Yet, the number of stocks making new lows has not expanded at all. A failure to increase new highs means folks are not willing to do a lot of buying and expand their buying of stocks. A lack of new lows means they are not selling much. You would need to see an increase in selling to get real weakness and much more bearishness.
But all of this means none of the indicators have changed. The McClellan Summation Index is still flat. It didn't go down during last week's 1.5% decline, nor did it go up during this week's 2% rally. There is a lot of churning going on.
The Bank Index has gone nowhere for weeks.
The energy names are stalled out too, although not as badly as the banks.
And the industrials had one good day and then a chopfest.
The Invesco QQQ exchange traded fund (QQQ) , which was at the bottom of the channel coming into the week are now getting close to the top of the channel. The S&P which did not tag the lower end is now getting close to the upper end. Clearly a few points means more for the QQQs than it does for the S&P.
In any event my very unscientific Twitter poll from the weekend seems to have proved to us that when folks get as bearish as they did (we had a spread of 20 points between bulls and bears tilted to the downside), it's time to go the other way. But now I wonder if this week's action has changed their view since Saturday.