Dow Jones +1.85%. SP500 +0.64%. Nasdaq +0.2%. Small Caps +3.57%. Banks +3.02%.
Nasdaq was still in negative territory until the last few minutes of trading.
Dow, Small Caps and Banks all show "blow-off" candles. Coming at the top of a trend, that's not a great sign. There could be more in this, but it looks like Fear of Missing Out FOMO to me. Weak hands chasing the price up.
The following is, I believe, a cautionary note on CNBC today from Bespoke Investment Group which noted that Small Caps are now 4.4 Standard Deviations above its 50-Day MA. Small Caps have never been that far ahead before in history. And only three times in history has such a reading been recorded by major industries: Dow 1900, SP500 in 1928 and Nasdaq in 1971. How much higher can it go with such history behind it?
SP500
SP500 remains within its bearish upsloping wedge. A standard measure move on the chart above indicates where a retracement might target. That's a move of about -7.6%.
Commodities.
Commodities, apart from Gold, are not favourable for our Resource Stocks today - but that won't stop a strong start to the day.
Commodities Index -0.32%. Energy -1.16%. Base Metals -1.43%. Agriculture -1.48%. Gold +1.99%
After 20 minutes of trading this morning, XJO is up +0.42%.
Take care.
(20min delay)