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MV Boom Box: Bulls Said Knock You Out!


Rain or shine, we review the day's biggest stock stories.

Don't call it a comeback
I been here for years (months)
- L.L. Cool J, Mama Said Knock You Out

Bears continued their frustration today as the "bear market rally" revealed fresh new highs for the year.

The S&P 500 was up 1.53% to 1068, closing right on the high of the day. The index has closed higher everyday this week and going back to last week, it is up eight of the last nine trading sessions.

Last night in his report, Bedtime with BTIG, Mike O'Rourke Chief Market Strategist from BTIG had this to say about the S&P 500.

"For anyone keeping score, the 58.3% rally from the March low is officially now more than the October peak to March trough decline of 57.7%. When the rally is larger on a percentage basis than the decline, it makes it tough to generically refer to the last six months as a "bear market rally." For market watchers who are predisposed to investor vertigo and believe we have gone too far too fast, take solace in the fact that the S&P 500 is still down 33.2% from that peak and at levels first achieved in 1998. It needs to go up another 50% to exceed that October 2007 peak."

I found his thoughts rather interesting, as he pondered at what point will this rally cease being titled a bear market rally?

Today on the Buzz and Banter, Professor Smita Sadana shared her input as she hinted that the market may be getting overbought.

"The McClellan Oscillator is currently at 224 (intraday reading). Getting hot. (For whats it worth, similar readings in July didn't do much to the market).

"Standard and Poors Short Range Oscillator was +9.3 as of the close yesterday. Now that's certainly a rare reading, since the highest reading I've seen in the past year was 11.6. But to add to the confusion, that reading of 11.6 came on 7/24, AFTER similar high readings in July. The market continued it trek higher with some rest-stops.(it was unusual market behavior).

"Here's a chart of the market levels and S&P Short Range Oscillator readings:

Click to enlarge

"So, in terms of overbought readings, we are getting somewhat overheated but in terms of recent reaction to those readings, will these be the cause for a pause?
"Never a dull moment. is there?"
Lastly, for fun, I decided to run a screen on S&P 500 companies that made new 52-week highs for the day. The screen returned a diverse list of 40 companies.

Here are some of the more popular names and the industry. They are: Apple (AAPL) (Computers), AES Corporation (AES)(Utilities), Google (GOOG) (Internet), Goldman Sachs (GS) (Financial), Gap (GPS) (Retail), Hospira (HSP) (Healthcare), Lennar (LEN) (Homebuilder), 3M (MMM) (Conglomerate), Noble Energy (NBL) (Oil &Gas) and Walgreens (WAG) (Drug store).

What does this list show? I think it explains that the rally has been very diverse and the way things are going, more companies will be showing up on that list.

That's all for tonight, have a good one!
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No positions in stocks mentioned.

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