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The SPY more or less filled the gap to yesterday’s open before plowing on higher. While most trading sessions have been somewhat frustrating this year for active traders, as the majority of gains have come on overnight gaps, today we are seeing some more energy in breakout plays. From the semis to the homebuilders, to the hand-grenade biotech’s, to solars and small-cap oil plays, the health of the market is improving. It is encouraging to see each gap get filled within a day or two, which to me illustrates that the market is cautiously optimistic, as opposed to euphoric and throwing caution to the wind.
As we work through the afternoon, I will be closely watching to see if more breakout plays to gain traction, and for the ones that have already broken out to hold those moves.
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Love the smile…