{"id":65125,"date":"2023-07-16T06:40:00","date_gmt":"2023-07-16T13:40:00","guid":{"rendered":"https:\/\/drduru.com\/onetwentytwo\/?p=65125"},"modified":"2023-07-16T08:45:55","modified_gmt":"2023-07-16T15:45:55","slug":"breakout-week-ends-with-key-setback-the-market-breadth","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2023\/07\/16\/breakout-week-ends-with-key-setback-the-market-breadth\/","title":{"rendered":"A Breakout Week Ends with A Key Setback – The Market Breadth"},"content":{"rendered":"\n

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

The stock market pushed into overbought conditions<\/a> last week. After one follow-through day, small caps wilted and dragged down market breadth toward the overbought threshold. That key setback raises the stakes of the current earnings period. I will try to look through the likely “chop” in the trading action, to identify on-going pockets of buying strength and well-supported uptrends.<\/p>\n\n\n\n

Steve Eisman (of Big Short fame) visited CNBC’s Fast Money on Thursday. He counted himself as one of the people surprised by the strength of the stock market. In particular, he underestimated how much money institutional investors apparently had on the sidelines coming into 2023. (This observation reminded me of Tom Lee’s early 2023 claim<\/a> that retail investors would stuff $1.8 trillion of cash into the stock market starting this year.) Now, Eisman thinks the stock market will keep “chugging along” as long as the economic data stay “fine.” Similar to Raymond James’ recognition of the unexpected resilience in the home builders sector<\/a>, Eisman’s acknowledgment stands out as particularly significant. This is particularly true during a period when too many remain engaged in an ongoing 12 to 18-month journey, expectantly waiting for a recession<\/a>.<\/p>\n\n\n\n

Perhaps the next recession is waiting to appear after nearly no one expects it…<\/p>\n\n\n\n