As 2 of the 3 major stock market indexes plow into all-time high price territory, our Current Market Outlook remains “Market in an Uptrend” and our light is “green“. Currently, each of our “core 4” internal indicators are green. Our regular readers know that our signal turned bullish (green) on January 17th and has stayed there since. This once again proves the internal math of the market trumps the TV talking heads and investors fickle emotions every time.
In recent weeks the IPO market has heated up, confirming the view that the economy is still growing and investors appetite for risk assets is expanding. Last weeks announcement of 1st quarter GDP over 3% surprised the naysayers but emboldened the bulls. Additional signs of growing market strength were seen in the resurgence of regional & money center banks as well as a sharp rebound in the health care sector. Speaking of health care, a look at the charts of that industry group reveals a classic, text-book “higher low” pattern as recent announcements from the democratic party sent those stocks into a tail-spin, only to see eager investors snap-up those shares quickly creating the visual “higher low”.
While no market rally ever goes straight up without some sort of minor correction, this rally is attempting to defy gravity. We expect to start hearing many commentators warn investors about the “sell in May and go away” phenomenon. Spoiler alert: It’s not a phenom. The market will pause and even pull back at some point soon, but no one knows when that will be or why it will happen. Ignore the doomsday calls and instead listen to the voice of the market; e.g. the daily price & volume readings of the popular indexes, and watch the action of the leading stocks of our day. While you’re at it, check out Investors Business Daily for unbiased market information.
Have a Triumphant day! ®
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