TAPE has reached a stage where most stocks are participating in this rally.
Many are worried & expecting a full blown correction.
This is Option Expiry week which may propel this market higher not lower.
Biggest support for this market has been ongoing skepticism & buying of Vix & Puts.
Laggards present the-biggest chance of outsize gains..... example a runaway bull market in Solar stocks.
This TAPE has a unique character of low allocation participation by all participant.
Many are sitting this rally out in hope of a pullback which has not materialized.
Most traders are not fully exposed in this market for a long time.
We are @ a stage where many will jump in as correction is not in the cards yet......
I have a feeling that this market has entered a phase which is popularly known as "blowoff".....this phase may last several weeks once it takes hold.
How can one tell IF we are in blowoff stage......volume is high & stock gains are outsize...example solar stocks last few weeks.....
Have you noticed that most earnings report are being rewarded even when they miss most of the time.....Top line has been weak generally speaking...guidance has been lower than expectations but stocks being rewarded on a daily basis.
Yes much dreaded month of May can be an exception this time when TAPE may go parabolic.....
Keep a close eye on chart where "breakout" is in focus, many stocks are in breakout mode.
Buying breakout does not mean expensive stocks, many laggards are in breakout mode as per www.stockconsultant.com
SO.......you are witnessing a runaway TAPE, embrace it or you are missing an opportunity of a long long time.
A TAPE like what we have do not collapse all of a sudden, it pauses, regroup & move UP again & again.
What you have seen lately is what you are going to get as we move forward.
Good luck with your strategy & please do not buy puts or short this market..... It is going to be extremely dangerous for your financial health. Market is in rotation mode which can go on for a long time.
BLOG does NOT give buy or sell.
Saleem
4 comments:
Hey Saleem,
Bought M @ 46.89.
Stocktrader
Hi Stocktrader,
Good luck with Macy's ..my favourite US retail giant.
Saleem
Hey Saleem,
Sold WPRT @ 28.914 after reading a Seeking Alpha article that points to potential management misstatements or even lies that affect the company's underlying value greatly.
Although I generally don't put much faith in single articles, it actually addressed some of the things that bothered me about the company anyways, and these potentially changed facts alter the company's value so greatly that it might not create value for years or ever.
I realize the short interest is very high and the explosive nature of the stock exists, but I've decided to wait for a more tangible turnaround before jumping back in.
Stocktrader
Hi Stocktrader,
Doing ongoing analysis is extremely important for any position.
Good luck with your new pick.
Saleem
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