Major averages finished mixed on higher volume. As the S&P 500 carves out new highs, the NASDAQ Composite and Russell 2000 play catch up. The NASDAQ is now firmly trading above its 50-day moving average while the Russell 2000 rests roughly at its 50-day. That said, the Russell 2000 has been the weakest index and Friday's higher volume on a lower close signals another distribution day for the index. However, the huge number of actionable names this past week speak to the potential durability and sustainability of the current rally.
However, as the indexes drift higher, the more important question for stock investors is where and how does one make big money in this market? Where are the "new merchandise" type of dynamic, innovative growth names that can sustain big price moves? In our view, stock selection will be key if the rally turns out to be sustainable, and in this vein one must ask whether the names that they seek to purchase are earlier or later stage situations, e.g., new merchandise vs. old merchandise. Think TSLA in May of last year, YELP in June of last year, FEYE in January of this year, etc. Are there names like these that exist in the market right here, right now? This is an important consideration that investors should take into account in what is now June of 2014, as it probably leads to the most profitable routes if and as the general market rally continues.
This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2019 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.