Over the past two weeks I don't see how things could have gone any better for me in the sectors I was looking at. Now we are up near a bunch of resistance levels in the NASDAQ and so far any selling has been absorbed. I will still be on the look for new setups in individual names and paying attention to which sectors are setting up for new moves. This weekend is looks like the financials and discretionary are looking best for fresh upside. That's not to say that healthcare and technology are out of the game but they have had their powerful moves already I feel like. They could continue higher and I am still holding some positions in there but I am always trying to stay a step or two ahead of the market.
SPY making all time highs and there are no signs of reversing at all. Looking at the weekly chart, it is a fresh breakout only two weeks into it so there is no reason to think we couldn't get another week or two of this.. unless you make decisions based on emotions. In that case there is no way this house of cards can continue higher, I mean did you see the GDP number? The NASDAQ, like I already mentioned, is testing the resistance level from March after a very nice move higher and in this case I ask myself "where has it come from" and "where can it go". Big move into resistance so we expect some selling to take place, but that doesn't mean it will. If it does we watch how buyers react to the selling since they are in control for now. Bonds are just playing mind games with people and it is so funny to watch. Now up here people are calling a top which is ridiculous.. makes me think we don't see any profit taking (back down to 130m trend levels which has been normal in this strong trend) and just keep moving higher. Those damn HFTs getting in the way of public opinion. Either way I am still trading it long side only.
Next week's sectors I am watching is going to be the financials, energy, and discretionary for fresh moves. Everyone hates the financials and they look great technically. Everyone is bitching about discretionary under performing staples which gives a negative connotation to XLY and it also looks good technically. Energy seems to be coming out of this consolidation after that nice move higher and looks good for more upside. So I will be scouting good looking individual names in those sectors for fresh moves and managing the positions I already have in the healthcare & tech area.
Trade well,
-Michael
