Blue Skies Ahead?
by
, 06-03-2017 at 02:28 PM (2971 Views)
Disappointing jobs report? No problem. That should help keep interest rates low for the time being. Certainly our F fund is in agreement with that perspective as it remains in full bull mode.
I was bullish for last week, but cautioned we could see some weakness should the market need to gather some strength before pushing higher. And that's largely what we saw as the first half of the week was saw some moderate selling pressure, but the last 2 days erased those losses and then some to close out the week in the green.
We can see that the S&P 500 had another decisive break to the upside over the past two trading days. There is no overhead resistance. RSI is a hair from overbought, however.
Folks who had been feeling largely left behind in the S fund got a nice surprise on Thursday as the index had its biggest 1 day gain in weeks. Friday saw price test its April peak and close at a higher high. But that end-of-day selling on Friday could mark a short-term top.
So are blue skies ahead? Probably. I see no reason to look for a longer-term top right now, but some short-term weakness is likely next week. Sentiment is still supportive. NAAIM in particular remains bullish. Breadth is solidly bullish as is liquidity.
I am looking for some degree of a pullback next week that may not get much traction, though small caps could see more than just token weakness. The longer-term remains bullish.