Markets rose firmly for a second straight day after a weak start to the week. While volume was strong Monday on the downside, Wednesday saw active volume backing up the move. Whereas volatility can be associated with short term tops, for the most part preceding this week trade has been calm with the exception of a few wild sessions. The Dow for example has closed on a weekly basis within 41 handles of each other the last 3 weeks. Is it too early to say volatility is back? The banks are all the rage this week as JPM reported yesterday and came through nicely. For me I am tired of everyone beating up on them. I congratulate you JPM for a good quarter. Imagine how good it could have been without all the negative media coverage weighing it down. BAC reported today and was also well received. Tomorrow we get releases from GS C FRC. MS reports Friday and took out a cup with handle trigger trade today. Another imperative group is the transports, have been acting well. The IYT hit an all time high today, with the Dow Jones about 100 handles away from its, for any Dow Theorists out there. CSX will report after the close tonight, and although it is not as relevant as it once was it is at all time highs and should be listened closely too. We have had an abundance of correction calls with Bob Doll last week, Byron Wien this week, and even @TheKillir on the @TheKudlowReport last night calling for a cautious stance. I agree with them all, but the omnipotent tape for the time being is saying otherwise. Trade accordingly.
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