Momentum Monday – The Bulls are in charge

The charts on Momentum Monday are powered by MarketSmith

You know it is a bull market when you sell a few positions for decent gains and they keep going higher. The bulls (the optimists) are fully in charge right now. This doesn’t mean that the indexes won’t pull back. They will. It just means that when they will, dip buyers are likely to show up and defend the important technical areas. Look at the price action in the small-cap index Russell 2000 for example. It ran to 160, which has been a notable resistance. It pulled back from there only to find strong support right where it had to: 158. Now it will probably spend some time in a tight range between 157-160 before it is ready for another potential breakout later in the year.

Semiconductors continue to be the obvious price leaders in this tape. SMH will probably try to consolidate in a range while its rising 10 and 20-day moving averages catch up with it. In the meantime, there are still some good long setups in the sector: KEYS, MRVL, OLED, IPHI, TER, AMD, NVDA, etc.

The biotech sector is in a raging mode. For two Fridays in a row we saw some heavy buying in the sector. There are so many breakouts, both in stocks near their 52-week highs and in stocks far from their 52-week highs: MRTX, BGNE, IOVA, NVRO, NVCR, INCY, ALXN, AMGN, etc.

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