Karpel’s Corner: Market goes “higher, baby!” But will it ever come down?

July 25, 2014
By Vlad Karpel

Welcome to Karpel’s Corner. This is where I throw out my thoughts on the markets and share some of my favorite strategies. I keep it market-focused, and never miss an opportunity to teach trading strategies and commentate on the latest trends affecting the financial markets. Hope you enjoy today‚Äôs post!

The Bears must feel like they are in a padded room with “White Lines” by Grandmaster Flash blaring in the background: “Get higher, baby!” (The ’80s were supposedly the decade of GREED.)

I had to go there since we are getting to levels on a monthly basis in the NASDAQ ($COMP) that we haven’t seen since 2000.

The bulls are having fun at this stage. But, for those who are looking to jump in and ride this market at these levels…. Well, it is
tricky. It’s just not that easy. The Dow ($INDU) best represents this mentality. It has been trading sideways during the earnings cycle.

Right now, we are managing the winners closely. One sector that is starting to show some potential challenge is the home builders ($XHB).
They have been trading on the lower end of a range. Now, this sector has been a big consolidation at this point. But a break of ~$30 would be a red flag for this sector.

Look at the metals market: Man, did the $GOLD lose it’s luster fast! With the EU currencies all under pressure, it makes some sense. But the gold bugs need to watch the
$1280 support level. A break at this level in $GOLD would be a negative for the shiny metal.

Join us today at noon for a webinar on critical metrics and tools we use to assess and manage these types of
risks.

See you next time at the Corner!


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