Markets showed some brawn Tuesday as benchmarks pushed ahead close to 1%. Three times the indexes sold off after a decent rally at the open and each had every reason to falter, but did not. The IWM “lagged” slightly as it attempts to thrust above its 200 day SMA. The S&P 500 broke away from the very tight consolidation we spoke about yesterday and CLOSED just under the round 2100 figure. Keep in mind the 2130 level has been very stubborn resistance dating back to May. We hear the continuous talk about breadth not participating and while it is very accurate, the calls for the markets demise because of it has been anything but. Bulls can point out how it is a positive that the indexes continue to slog higher despite the bearish breadth. FDX reported Monday it expects a better than 12% increase year over year of package deliveries and what did the stock do? It slumped 3.4% on the largest volume in 2 1/2 months. Markets overlooked CMI frailty Tuesday as the stock slipped 8% taking out a bear flag pattern at the very round par figure. Markets yawned. Of course this strength can falter at anytime, but until it says so technically one should remain patient. As hard as it is, remember as Livermore said the real money is made by “sitting on your hands”. There have been some bright spots outside of the “FANG” names. Semiconductors continue to strong steady march upward. NVDA has been on a tear this week and was in our Game Plan today with an entry above a flag trigger of 32. Below is how the chart was presented in our daily report.
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