The brushed off early weakness Monday and closed in the green, making this the fourth positive day out of the last five trading sessions. While it takes a magnifying glass to see these 0.1% and 0.2% gains, the most important thing is we keep making higher highs.
As the well-worn market truism tells us, stocks take the stairs up and the elevator down. As trivial as these individual gains seem, a pile of them turns into some really nice profits and that’s exactly why this market keeps setting record high after record high.
There are plenty of reasons to dislike stocks at these prices, but most investors have heard all of these recycled criticisms and they still don’t care. When the market doesn’t care about the headlines, then neither should we.
Without a doubt, this bull market will die like all of the others that came before it. But it will hit 4,300 and probably even 4,400 before that happens.
Stick with what has been working and that is holding for higher prices. Trading is rarely this easy. But when it is, the last thing we should do is fight it. Shut up and take the free money.
While the index added a modest 0.18%, the FAANG stocks popped 1% and 2%!!! This outperformance is absolutely noteworthy. For months these supposed best-of-the-best stocks have been lagging behind and their underperformance has been holding the entire market back.
While one day doesn’t make a new trend, we’ve been seeing pockets of strength bubbling to the surface. Alphabet (NASDAQ:) has been trading well for a while. Facebook (NASDAQ:) is back at the highs. Even Apple (NASDAQ:) and Netflix (NASDAQ:) have been getting their mojo back. And the laggard of the group, NFLX, has been carving out what looks like it could be a base if the stock holds above $500 support.
The indexes struggled this spring without the FAANG leadership. But if the tide is changing, these stocks could start pushing the entire market higher. If the indexes and the FAANG stocks start rowing together again, it will be a very good summer for everyone that didn’t sell in May.
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