Market players wasted no time building on the gains they saw in July. It was another powerful day for the market with the Nasdaq 100 fund, the Invesco QQQ (QQQ) , doing well again, but this time the buying broadened out and small caps on the Russell 2000 fund (IWM) outperformed. Breadth was negative on Friday when Apple (AAPL) rampaged higher, but Monday it was around 5,500 gainers to 2,275 decliners and there was green all around.
Mondays have been good days for the market, with just one down Monday in the last couple of months. The first day of a new month tends to do well, also, so we had both those stats working for the bulls today.
Although the bears will tell us that this action is froth, unjustified, and won't last, it was pretty routine bull action. Not only was there strength in momentum stocks and over 500 stocks at new 12-month highs, but there were themes in "junk" small caps such as blockchain that drove names like Marathon Patent (MARA) and Riot Blockchain (RIOT) . Aggressive traders are still actively searching for the next mover and are creating some self-fulfilling prophecies along the way.
How much longer can this last? No one knows, but I'm not going to waste any time trying to guess. I plan on riding the trend to the bitter end. I'll suffer some losses on a turn, but the pile of profits earned in the meanwhile will keep me well ahead of my anticipatory friends.
This market has some similarities to the bubble in 2000, but that doesn't mean you should spend your time worrying about the turn. Worry about making as much as you can while the action lasts and play defense when you start losing money.
Have a good evening. I'll see you tomorrow.