Not much to add on the index level versus Friday’s comments – stocks opened down, dip buyers came in immediately and pushed stocks up but a bit of buyer exhaustion came in and all those gains were lost. Then a late day rally pushed indexes back to the green. The S&P 500 gained 0.09% and the NASDAQ 0.34%. We’ve been saying the past week the NASDAQ has more room to run then the S&P 500 and thus far it has outperformed but right now it is overextended.
Here is a 2 year chart of the NASDAQ McClellan Oscillator to show how extreme it is; the highest level in that entire time.
Apple (AAPL) split today and the stock rallied; it has come a long way since breaking out of the bull flag it was forming about a month ago.
Biotechs continue to outperform – we mentioned a very simple trade here….buy and stop out if it falls below support (dotted blue line). Thus far that is a money maker. Of course you can bring up your stop loss along the way here to lock in gains. ETF IBB
This even as key component Gilead Sciences (GILD) had a very rough day [due to Merck buying hepatitis C competitor Idenix Pharma]:
Family Dollar Stores (FDO) rallied after Carl Icahn late Friday reported a 9.39 percent stake in the discount retailer, making the hedge fund billionaire its biggest stakeholder. Must be nice – load up on a stock, tell the public, and then make tons of money instantly.