{"id":57203,"date":"2021-07-05T17:52:59","date_gmt":"2021-07-06T00:52:59","guid":{"rendered":"https:\/\/drduru.com\/onetwentytwo\/?p=57203"},"modified":"2021-07-06T10:04:29","modified_gmt":"2021-07-06T17:04:29","slug":"t2108-update-a-stock-market-melt-up-with-shrinking-participation","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2021\/07\/05\/t2108-update-a-stock-market-melt-up-with-shrinking-participation\/","title":{"rendered":"A Stock Market Melt-Up With Shrinking Participation – Above the 40 (July 2, 2021)"},"content":{"rendered":"\n

Stock Market Commentary<\/strong><\/h2>\n\n\n\n

A stock market melt-up is in full effect. Investopedia defines a melt-up<\/a> as “…a sustained and often unexpected improvement in the investment performance of an asset or asset class<\/a>, driven partly by a stampede of investors who don’t want to miss out on its rise, rather than by fundamental improvements in the economy.” In the current melt-up, the rush is subtle given the slow creep in the S&P 500 (SPY) since the early April breakout, and the NASDAQ’s earlier double-top. Moreover, the fundamentals of the economy continue to improve as further confirmed by the jobs report for June<\/a>. Instead, THIS melt-up is more characterized by the renewed persistence of a select group of stocks to move ever higher despite the drag of the majority of the stock market. Shrinking participation in the latest rally makes me as wary as ever of the stock market despite key buying opportunities.<\/p>\n\n\n\n

The Stock Market Indices<\/strong><\/h3>\n\n\n\n

In two weeks flat, the S&P 500 (SPY) transitioned from a breakdown below support at its 50-day moving average (DMA) (the red line below) to a surge above its upper Bollinger Band (BB). The index gained 0.8% and closed the week at an all-time high. In fact, the S&P 500 is on a 7-day streak of all-time highs.<\/p>\n\n\n\n

\"The<\/a>
The S&P 500<\/a> (SPY) gained 0.8% and closed at an all-time high above its upper Bollinger Band (BB)<\/em><\/strong><\/figcaption><\/figure><\/div>\n\n\n\n

The NASDAQ (COMPQX) barely looked back after invalidating the double-top from February and April<\/a>. The tech-laden index also closed the week at an all-time high for its participation in the melt-up. The 0.8% gain is the 6th up day of the 8 trading days since the breakout. <\/p>\n\n\n\n

\"The<\/a>
The <\/b>NASDAQ<\/a> (COMPQX) <\/b>gained 0.8% for a fresh all-time high.<\/strong><\/em><\/figcaption><\/figure><\/div>\n\n\n\n