Huge day in the broader markets. Google was up $90 bucks- unbelievable- why didn’t I have a few calls on that stock? It was only a 20% move, but can you imagine having a few calls at $10, making a $90 move in one day? Awesome. I guarantee some shorts got absolutely hammered in that stock.
There were 127 new highs on the NYSE, which is a very healthy number and suggests strength in the market. However, the NASDAQ is lagging with only 52 new highs- smaller stocks have not been invited to the party yet, and the Russel 2000 is lagging way behind. We need to see some strength in the small and microcap sector to really see some bids come back.
This rally is coming at the expense of short seller and bonds- the 10 Year has moved a full 4 basis points this week- that’s a huge move taking interest rates from 3.4% to 3.8%. Money is flowing out of bonds into stocks.
The anemic volumes in the small stock end of the market are still keeping stocks depressed. That coupled with an usually high number of redemptions at microcap funds, has the supply in that arena continuing to collar upside.
SPKL had on OK day, only giving back $.01 of yesterday’s move. EFSF was sideways as well, along with PNWIF and NIHK- the subject of the weekend edition.
The large cap action is encouraging- suggesting we will see some action in the small cap world in the near future.
Larry,
Do you have any ideas regarding large cap stocks? I’m looking for some redemption after that RIMM fiasco. Thanks.
Editor: Now that there has been a big move in the markets over the past week, there must be some trades out there. I’ll start looking for another good trade this week, and see what I can find. Wish I had caught GOOG. RIMM was a bit frustrating as I had it right for a trade, but traded it the wrong way.