Today the market tacked on further gains (NASDAQ +.9%, S&P 500 +.5%) as momentum continues to carry us from two weeks ago. Draghi's comments, while they fundamentally fixed nothing for Europe, have once again put Europe on the "don't worry, be happy" loop and allowed US investors to focus back on the notion that earnings are fine and if worse comes to worse, there is always Ben to save the day. Translation? Risk on.
However, there are warning signs to be aware of. The Transports have not confirmed the latest movement, leading stocks look just "good" and not great technically, and Europe's markets have gone skyward (Spain is up 21.8% and Italy 19.1%) the last two weeks off nothing but hope for a fix that doesn't exist. So despite the technical improvements, I can't help but feel we are still walking on thin ice.
Stay frosty (sharp) out there and I will see you back here tomorrow.
And here is an updated look at Apple (AAPL) courtesy of my MarketSmith account. It is great to see the stock break through $620, but the lack of momentum since, terribly low volume, and no confirmation day is not a good sign. For those that bought on the break a tight stop may not be a bad idea.