Equity markets around the globe gapped higher Monday. After a week that had showed improvement, but not solid strength, this was the exclamation point that put them over the top. With less than 1 week left in April the question now is will this hold up? This would add to the months of consolidation at the highs for the S&P 500 and the Russell 2000. But for the Nasdaq 100, it will mark another higher high in the trend up that began not in November 2016, but July.
And all it took for renewed strength was an election that turned into a runoff between a Communist and a guy who married his high school teacher in France. What does this tell you about equity markets around the globe? It certainly does not instill the feel of strong investor confidence. There is an apprehension to put new money at risk ahead of any major decision now. And then once the event has passed it floods in. Money is not selling hard into events, it is just pausing. This is a sign of a very strong bull market.
Sentiment surveys are swinging in the wind, like the changeable spring weather. Short term traders are looking to sell the gap up and they may win in the short run. Longer term investors are just waiting for the next event to pass and then plunking down their money. It is a good sign that sentiment keeps getting bearish after a few days of movement higher. You should hope that it continues this way. The slow grind higher will continue with that perspective.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.