After the big move last week you might think we were ready to rest a bit before the next group of major earnings reports. However, you underestimated the anxiety over being left out of this market. When we go from struggling to holding support to testing highs within a week without any notable pullback, the anxiety over being left behind rises exponentially.
We had one dip this morning but otherwise it was a steady, very broad upward move. The weak dollar plays -- gold, oil, steel and commodities -- led but there was strong action in big-cap technology names and many of the Investor's Business Daily-type names, like PWRD, CYOU, etc. Many of these types of names had very strong moves. Many of these are China-related names and smaller-caps in that sector also performed very well.
It is obviously very strong action; trying to short this is like trying to time when a speeding locomotive will come to a stop. On the other hand, it's nearly impossible to find stocks that haven't gone straight up for several days and are now extended. It is almost bubble-like action in some stocks and if you aren't chasing, you are being left behind.
Right now the big worry is underperformance and that tends to promote strong underlying support, but with some big earnings on Tuesday night and Wednesday morning, volatility is likely to pick up sharply.....