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The Rally Everyone Will Try To Fade Takes A Rest

|Includes: DIA, FB, GRPN, IWM, QQQ, SPY, Tesla, Inc. (TSLA), YY

A day after the non-Taper rate decision released by the FOMC US stocks take a break. One exception is the NASDAQ finishing higher by 5.7 points. Every other index pulled in nicely as volume fell across the board. This is the type of day when you don't see a follow-through on gains. Tomorrow's option expiry will distort volume for tomorrow and Monday so today's move in the context of this rally is okay in our book. Jobless claims came in better than expected, but were unable to repeat last week coming in below 300,000. A lift into the close was an added bonus to an overall decent day.

Just as important as the overall market health is the moves we are seeing in some of our leaders. Stocks like TSLA and FB are quite nice to see. You'll see the market's leaders push higher despite the overall market pulling in. YY was another market leader hitting another 52 week high. Many will be scared buying 52 week highs as they have been trained to buy low and sell high. Ideally, you get a long signal you want to sell higher. You can buy high and sell even higher. A few of our leaders are demonstrating just that. We are stuffed to the gills with longs and we continue to see more and more signals headed our way. It is very difficult to believe we should be shorting into this type of market.

Over in sentiment land we have the bulls coming in strong, but not an extreme level. AAII bulls remained at 45.11% and bears coming in at 29.70 an uptick from last week. We continue to see this from sentiment where bulls and bears are simply not hitting extremes where a potential top may be. All of our price signals are telling us to remain bullish on this market. Even the NAAIM Manager survey showed the number of bullish bets being made dropped 4 points to 62%. This rally will continue to be hated simply because the Fed is artificially keeping it a float. Have an exit plan, but not one based upon your opinion of what "might" happen. Rather used facts, more importantly price!

Tomorrow is a new day and one that we'll see options expiry play havoc with volume. Follow your stocks and your signals and the rest will be just noise to you! Have a great weekend.

Disclosure: I am long FB, TSLA, YY, GRPN.