A wild start and a weak finish has created a little buzz about today being a possible blow-off top in this market, which has had a frantic two-week rally. There was some very emotional buying this morning but a rush to protect gains kicked in during the final hour.
If we gap down in the morning, it will create an "island reversal" or "abandoned baby" top. That would be bearish but we don't want to get ahead of ourselves here. Despite the last-hour selling it was still quite a strong day for the market. The indices had solid gains, breadth was quite strong and there is a long list of stocks that made big moves on good earnings.
If you have been riding the momentum in this market, you certainly have to be on the lookout for indications of a possible shift in the market and some last-hour selling is worth noting. However, you can't underestimate the power of momentum.
We have not even begun to test underlying support yet. The dip-buyers let things slide a little in the last hour but that is not yet an indication that they are going into hibernation.
This has been a runaway market but I still find AAPL and BAC particularly attractive. We have some more good earnings after the bell, most notably from FSLR, so sentiment is likely to stay upbeat. Betting against this market is likely to continue to be quite a challenge.
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