The indices are solidly red this morning with breadth running about 900 advancers to 6250 decliners. There are only 16 new 12-month highs which is down substantially from a week ago.
Despite the negative action, there has been strong underlying support so far and the indices have been working slowly higher since the open. Pockets of speculative small caps continue to work and there is relative outperformance by FAANG stocks and the Nasdaq 100 technology names.
The fact that there is some interest in stock picking is the biggest positive I see right now and indicates that there is still plenty of liquidity out there. There is an appetite for the trades that are working even though the overall market action is poor and technical support problematic.
I'm focusing on some individual stocks such as my Stock of the Week, Chembio Diagnostics (CEMI) makes diagnostic test kits including one for Covid-19. The company has very strong EPS estimates and some good price targets from analysts.
Forum Merger II (FMCI) is acting better as the market contemplates its deal with Tattooed Chef. One of my favorite small-cap biotechnology names is Ocular (OCUL) and it refuses to pullback very much to allow me to buy more.
The indices continue to slowly climb higher as I write and make it clear there is still a strong appetite for stocks. The indices may need to correct some more but traders are moving quickly to find some individual stocks that are acting well.