The small caps are now noticeably lagging this morning, with the Russell 2000 down over 0.50% as I write this. Even though the major averages are flattish, I am seeing failed breakouts from attractive setups like OPEN, as you can see below. With this in mind, combined with short-term sentiment on the complacent side, I am focused more on protecting recent gains in my portfolio and having cash readily available to step in for another round of fresh setups. Mind you, I am not bearish on the market over the intermediate-term, but short-term I am inclined to sell into strength than buy more.
Those setups may take a few days to form, which is why I am opting to stand pat here. Of course, many are positioned for the market to push higher yet immediately. If that happens post-FOMC today or tomorrow, I will likely use that strength to lock in more gains and wait for a better spot.
As I noted last night, a bunch of energy stocks caught my eye, as with quite a few financials not yet extended. However, the overall market is lethargic this morning, probably drifting before The Fed.
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