The market action has a late-cycle feel to it but that doesn't mean that a significant correction is about to occur. There is quite a bit of aggressive speculative action in low priced stocks. I see at least 15 stocks priced under $10 that are up more than 8%. Big cap momentum continues as well with Apple (AAPL) shaking off a slight pullback, Amazon (AMZN) up on an upgrade, and Microsoft (MSFT) extending into new all-time high territory.
The fear of missing out is palpable but with no meaningful consolidation or correction since early October there is great doubt about the wisdom of chasing higher at this point.
Breadth is very good with about 5500 gainers to 1450 decliners, and there are around 850 stocks at 12-month highs. The S&P 500 is sitting in an intraday range so far but the power of this momentum is keeping the anticipatory bears on hold.
The challenge of this market is entry points. How do you put cash to work when there are so few prudent entry points? The hardcore bulls scoff at any hesitance but seasoned traders don't become undisciplined just because the market is acting in an irrational manner. The only way to deal with this is to keep on looking and trying to find some good entry points.
The easiest mistake to make right now is to say that this can't continue for long. That simply is not true. It has already lasted far longer than many think is reasonable and it can continue even longer.
I've made a few minor buys but mainly I'm just riding my existing long positions and trying not to sell them prematurely.