Markets were energetic in the early going and never saw red ground as all of the major averages were well behaved. The Dow has rose 15 of the last 18 sessions and is now on a six week winning streak with all of them CLOSING right at highs for the weekly range. The Dow was easily the best performer this week rising 2%, and the bears will point to the fact the investors are yearning for some old, boring names which is just the type of action you see near the end of a bull market. The say it is now how you start but how you finish as the Nasdaq advanced for a sixth straight Friday. The tech rich index rose .3% this week and the S&P 500 galloped ahead by .9% this week and is on a firm 6 week winning streak as well. The Russell 200 gained .4% and is on the verge of a bull flag breakout. The IWM has CLOSED the last 3 weeks remarkably taut within just .68 of each other. Bulls will be correct to mention that the small caps often lead, and if this flag is taken out this could ignite a whole fresh wave of buying.

Looking into individual sectors today it was the financials, industrials, materials and technology that were the finest actors. The XLF and XLI both advanced more than 1% Friday and the staples were the only major S&P sector to lose ground today with the XLP slipping .2%. PG fell more than 5% this week, registering its worst weekly drop in almost 2 years since the week ending 1/30/15 fell more than 6%, and it looks like a long term double top in the 93-94 was completed the week ending 9/22/17 and began the week ending 12/26/14. Others in the arena are much worse off like CHD now off 15% from most recent 52 week highs and has declined 8 of the last 12 weeks. On a weekly basis only two of the major S&P sectors that fell with the XLE losing .5 and the XLP dropping 1.2%. The financials recent strength is noteworthy but the group is the best performer on a one and three month timeframe as well as the one year time period. Perhaps they are not getting the credit they deserve in contributing to this overall powerful rally.

The transports group should be renamed the teflon sector, as it seems to smooth out and disregard any potential problems that may creep up I was WRONG about being somewhat bearish on the space as the IYT recorded a nasty bearish engulfing candle on 10/13. The ETF ended up finishing higher for the week and the last 4 weeks have now CLOSED very taut all within just 1% of each other. That type of tight action often resolves in a continuation of the prior trend. The JETS (airlines) ETF lost ground this week, but the prior 5 all rose by almost 7%. The rails were led to the upside by CP which put in a stellar week advancing 5.4%. Below is the chart of a trucking play, ODFL, and how it appeared in our Friday 10/13 Game Plan. Today it drove to all time highs, pun intended, and taking out a bull flag formation that started at the very round par number while rising 10 of 11 sessions between 9/15-29. Look for a move to the next round number into year end at the 120 figure.

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