Dr. Kris'  Instablog

4:00 pm ET: Wash, rinse, repeat. That's been the tone of the market for the past few trading days. I don't have much to add to what's already been said, except that I am a bit surprised that the market held up considering the worse than expected GDP number that was released earlier. (It came in at 2.5% instead of 3%.) Apparently, money printing trumps fundamentals but there will come a time (maybe soon) when investors feel the market is overbought. Right now there's no way to tell. Market internals show the bulls and bears duking it out and it's not clear who has the upper hand. Perhaps the fact that the bears are have made it past round three is an indication that they might deliver the one-two punch to end the bulls' run.

In other news, solar stocks continue to advance and homebuilders are bucking up after a brief slump. Precious metals took a breather after this week's rebound off of oversold levels. Oh, I forgot to mention that the pound sterling etn (FXB) broke $152 resistance yesterday. Upward momentum seems to be on its side and a move to the $161 level could well be in the cards.

That's it for now. Next week there probably won't be a blog until Thursday as I will be attending the NAAIM conference in Denver.

Weekend reading suggestion: It is rumored that there will be an article on me in tomorrow's weekly edition of Barron's, both online and in print. Here's a link to their website: online.barrons.com/this_week

4:00 pm ET: Today the market marched in like a lion and limped out like a lamb. The mid-day turnaround looked to be the bulls passing the baton to the bears. For the past few days we've been noting that the VWAP's (a measure of "Smart Money" activity) on both the buy and sell sides have been elevated indicating a possible changing of the guard. Note that there are only three more trading days left before the "Sell in May" phenomenon kicks in. Of course there are no absolutes in the market and, yes, this year could indeed be different--but I don't think so. I gave four reasons to support my thesis yesterday. Here's another one to add to the pile.

Yesterday, CNBC ran not one but two separate segments showcasing bigwigs at Goldman Sachs, both of whom are bullish on the market. The reason they gave was the same: Their in-house economists think the world is in a state of economic expansion which will continue to fuel not only our stock market but markets abroad as well. I don't know what numbers they've been looking at but I'm sure not seeing much that cheers me. Recovery in the Eurozone is tenuous at best and who knows what China's growth stats really are?

In this country, not everything is as rosy as it's being painted. Sure, the financial media has been touting that 70% of all companies that have reported so far have beaten earnings estimates but what they've been omitting is that overall revenues are falling. This fact indicates economic contraction, at least it does to me. But not being an economist, I certainly could be wrong.

Whatever.

Putting this all aside, the fact that two spokes-folks came out publicly spinning the same yarn has me thinking that Goldman must be building up a huge short position in the equity markets. Yes, this is the cynical point of view but if past Goldman dog-and-pony shows are any indication, I'm sticking with it. (I've always been suspicious that something's afoot whenever Goldman trots out Abby Joseph Cohen.) With that said, I'm mounting my soapbox and recommending that people prepare to batten down the hatches as May could get very ugly.

Subscriber Notes: There is one new Stock Darling.

4:00 pm ET: Today's Highlights
The major averages continued their rally despite some negative economic figures. This market seems to be advancing on fumes and some storm clouds are forming on the horizon. To wit: 1. Despite today's advance, the Dow Transport Index (DTX) still hasn't been able to break out of its downward trending channel; 2. The low VIX is indicating growing investor complacency; 3. Negative VWAPS, a measure of institutional selling, are on the rise even on bullish days like today; and 4. Consumer staple stocks are selling off which could be an early indication that conservative investors are moving into the safety of cash. (Also, this sector could just be taking a much needed break.) No need to run for cover yet but you should be readying your game plan if and when the market turns around because it could happen soon and very quickly.

Aerospace and defense stocks saw lift-off today as industry giant Boeing (BA, $91) reported better than expected earnings with an improved outlook for delivery of their problem-plagued Dreamliner. The news not only sent shares of the company to new yearly highs but also those of Northrup-Grumman (NOC, $74) and Orbital Science (ORB, $18). All of these issues gained 3% on heavier than normal volume. On a technical note, I think they're all solid buys at these levels and I particularly like the strength in Northrup-Grumman's chart, having recently rallied through $70 which has proven to be a multi-year resistance level. As an added bonus, all of these stocks pay a 1% dividend.

Upward momentum is increasing in solar stocks which numbered among today's biggest winners. Shares of First Solar (FSLR, $12) jumped 12% on twice normal volume to hit a new yearly high. Outpacing this move was that of JinkoSolar (JKS, $6.54) which gained a whopping 15%, also on heavy volume. The stock broke through $6.50 resistance and if it can keep up this pace, it'll be testing $10 major resistance in no time. The gain in solar issues helped boost a couple of Clean & Alternative Energy etfs (GEX, QCLN) to new highs.

That's it for now. Getting ready for next week's NAAIM conference in Denver so I must scoot.

Subscriber Notes: There is one new Channeling Stock. Regarding yesterday's Stock of the Day candidate (which was up another 5% today), I sold some May 22.5 cash-secured puts for $1.30 as a buying mechanism. The put options are not heavily traded so if you want to follow suit, please use limit orders (day orders only!) and stand your ground. My trade languished for hours until the market maker relented just after the closing bell. (Options can trade for up to a half hour after the bell, FYI.)