A New Bull Market
The Nasdaq powered ahead for the 7th week in a row and remains in a power trend as we continue to see improvements in market internals.
While the first few weeks of this rally were dominated by the mega caps with not many stocks participating, we are starting to see signs that is changing. The market has now put together a streak of 6 days in a row of net highs and we are also beginning to see the number of stocks above their 50 day and 200 day moving averages beginning to rise, two things that we haven’t seen since the beginning of the year.
While the Nasdaq picked up a distribution day this week, it’s important to note that same day we still had net highs, and money was clearly rotating as the IWM staged a follow through day.
On top of the bullish improvement of market internals, individual stocks are beginning to sharpen up as well by following through on breakouts and earnings gaps, snapping back from shakeouts, and forming tight consolidation areas.
Despite, all of the positive action the Nasdaq is historically stretched from the 21 and 50 day moving averages. How the market handles the inevitable pullback will reveal the true strength of this rally, will net highs remain, will it find support at logical spots.
Market Navigator
Stocks
IOT 0.00%↑ Potential TML as this blasted higher on the highest weekly volume ever. Stretched in the short term and expect some consolidation here.
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TSLA 0.00%↑ Followed through on last weeks double bottom break out and increasing volume. Triggers William O’Neil’s 8 week hold rule. The RS line moving average crossover 3 weeks ago was a sign to start paying attention to this one.
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CMG 0.00%↑ A slower mover showing positive action. This week completed 3 weeks tight on decreasing volume. A touch of the 10 week moving average next week on a market pullback could offer a nice risk/reward spot.
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NVDA 0.00%↑ The TML in my opinion. Finished a 3 weeks tight pattern and finished in the upper half of the weekly range despite closing down. Might need more time to consolidate and allow moving averages to catch up as it is 19 weeks out of its latest base. Â
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