A strong day with basically no fade into the close. . . surprising for a long weekend and perhaps indicative of a short term trend change. The 5 minute 20 SMA showed the way all day, and especially for the afternoon session when I was expecting a weekend fade. It's proven to be a great short term trading trigger and stop for the past several weeks.
Although volume was within the 10 day range for the DIA, IWM and XLF, the Qs had the lowest volume in over two weeks. XLFs up almost 8% today, closing strongly above the 20DSMA and now entering the overbought twilight zone.
We'll be looking to see if the market can follow through next week with additional gains. Fundamentals remain dismal to doubtful and the real test will be market performance during the upcoming earnings season. If we see new bad earnings reports rewarded with higher prices, then figure a positive perception bias is in play and all bets are up. The converse is also true.
Weekly update to follow tomorrow.