Although the S&P 500 ETF (SPY) had a substantial gap-up at the open, it is trading in the narrowest intraday range since Aug. 17. Breadth has been steady with around 6,100 gainers to 1,300 decliners but there just isn't much intraday movement.
Typically, the longer the market holds on to gains the greater the likelihood that money on the sidelines will grow impatient and start to inch in. However, there will be plenty of stops at the lows of the day and if they are triggered the gap can start to fill fairly fast.
It feels quite complacent at the moment, which is a bit surprising as the election drama starts to heat up, although the only issue that most market participants seem concerned about is whether there will be a clear winner on election night. While I suspect this will eventually cause increased volatility, we are still a month away from election day and there isn't much interest in anticipating those problems at this point.
Before we deal with the election we will see a big part of third-quarter earnings reports and that is the primary focus of market players right now. The focus continues to be on stock-picking and I expect to see more positioning as the earnings dates approach.
A few names that I am expecting to see strong earnings from are Personalis (PSNL) , Big 5 Sporting Goods (BGFV) , (Read Shark Bites here), Digital Turbine (APPS) , Horizon Therapeutics (HZNP) , Xeris Pharmaceuticals (XERS) , Trulieve Cannabis (TCNNF) (read my analysis here), Nautilus (NLS) , Everi Holdings (EVRI) , and Coherus BioSciences (CHRS) .
I will be working to refine that list and find new candidates as we move into October.