It was a bumpy week for the market as volatility picked up and small-caps finally suffered some corrective action. We saw some of the broad, ugly selling that the bears have been looking for, which caused some pain as money rotated quickly and produced quick pullbacks.
The big winner was bitcoin, which gained further momentum and ended up near its highs of the week when the market closed. Bitcoin-related stocks underwent major swings. Other favored sectors such as cannabis, SPACs, EVs, biotechnology, and gambling, offered some good opportunities, but it wasn't quite as easy as it has been in recent weeks.
The good news is that this sort of volatile correction action is usually a good setup for another leg higher. The bears finally got a little relief and are happy to lock in a profit for a change and stand aside for a little while.
Another piece of good news is that there doesn't seem to be any slowing in the aggressive stock-picking. There still is a huge amount of liquidity out there looking for a place to go. Some of it flowed into bitcoin this week, but that simply confirms that this is a market with an appetite for higher risk.
The bears had an opportunity to build downside momentum but were unable to capitalize. That is nothing new and typically leads to another round of new highs before they will try again.
I remain optimistic about the stock-picking and will be ready to put more money to work next week.
Have a great weekend. I will see you on Monday.