It has been a challenging Monday morning so far but not because of the stock market. Both Google (GOOGL) and Schwab (SCHW) suffered outages and have been a distraction. Most traders have set routines and when there are technical issues it has serious repercussions.
Stocks opened strongly and held up very well for the first hour of trading but are now rolling over slightly. Breadth is better than 2 to 1 positive and there are nearly 600 stocks at new 12-month highs, so there is plenty of strength. The list of 10% movers is also sizable.
The question at this point is how willing are market players to chase? The S&P 500 is testing the day's lows as I write and the list of names at intraday highs is shrinking quickly so the answer to that question may be "not very much."
Action on my screens is very mixed. Some of the SPACs have pulled back but then there are others such as Desktop Metal (DM) , which is finally bouncing after much confusion following its change in symbols. A few SPACs like dMY Technology Group II (DMYD) and Social Capital II (IPOB) are acting well but the momentum has slowed.
I'm not overly concerned about pullbacks here as I think we will see some good support sooner or later. Still, I'm working to protect some good-sized gains and may have to do some selling and then rebuying.
The vaccine news Monday was well-anticipated so it isn't too surprising that there may be a little inclination to sell the news, but we have to watch and see if the Senate makes any progress on the fiscal stimulus bill.
I view this action as opportunistic rather than problematic.
