Second Day of Solid Gains Pushing Market Model Back to Buy
Joshua is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Another great day of stock market gains took place despite Apple (NASDAQ: AAPL) taking a back seat consolidating its gains from Wednesday’s market. Volume ended mixed, higher on the NASDAQ for the second straight day showing institutions are scooping up shares on the NASDAQ. The buying spree didn’t begin until the end of the day, but it came on strong and showed there might be some life left to this market. Economic news wasn’t great while jobless claims continue to be weak. It was just a solid day in the market thanks to AAPL for getting the ball rolling.
Sentiment took a dive this week as the number of bulls dropped considerably across the board to lows not seen for quite some time. It appears the crowd bought into the bearish talk out of Europe. Bears jumped on the AAII survey to the most since this uptrend began last year. Sentiment is not a perfect indicator, but it does appear sentiment got a bit overzealous to the downside.
There were plenty of breakouts yesterday and some by solid growth companies. Everyone knows the AAPL story, but a few other big names had some really nice gains. We love to see this when a market is about to rebound or start a new uptrend. A real positive is the NASDAQ getting big time support above its 50 day moving average. The combination of leaders and support above the 50 day could be setting this market to hit new highs.
Nothing is for certain, but the odds are beginning to stack up in the favor of the bulls. We aren’t going to sit here and argue with the market. It would not be a prudent move to let this market go ahead without us. Don’t argue with the market, because it doesn’t care what you have to say. Stick with the trend.
Have a great weekend!
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