The upward bias in stock prices continued because institutional investors continued buying stocks, encouraged that Trump’s proposed tax reforms moved a step closer to reality with release of a new House bill. Even declines on Friday due to a surprisingly weak employment report (attributed to disruptions by two hurricanes and deemed only a temporary glitch) was not enough to offset four days of rises in the major indexes.
Once again “the rising tide” influenced our stocks in a repeat of last week – including many of our long positions – both young and old – but also many of our shorts as well for now. Many new weekly highs, very few new weekly lows. Given that we hold more longs than shorts, it should have been a productive week for most of you.
No sign yet of any large market correction. The longer the bull run, the more predictions that “a big correction is near” – which is not surprising given it will happen at some point, and many analysts want to have made such a prediction now so as to be able to later claim some brilliant (“I told you so”) insightfulness. Many of these same pundits have been offering these same predictions for months or years, only to be proven wrong. Rather than investing based on emotional greed (still all long) or fear of correction (all short now), we will do what we always do – adjust based on timely, stock-specific analysis for optimum overall outcome.
Highlights: 10 new weekly highs in long positions. 4 stocks with double-digit long gains:
FIVN +20% BZH +52% FMSA +62% LPSN +92%
Congrats to those of you locking in gain of +136% in NEFF (47 weeks) – it has stalled at the cash buyout price per share offered by acquirer H & E Equipment Inc.
1 new weekly low among short positions. No stocks with double-digit short gains at this time.