NEW YORK (TheStreet) -- On Thursday, the market was searching for a bottom. Friday saw that bottom made.
All the indexes ripped higher out of the gate. The oversold condition, mentioned Thursday, in the Nasdaq
The S&P 500
The DJIA closed at 1623.06, up 58.83 points. The S&P 500 closed up 8.57 points, at 1857.62. Even though the Nasdaq and Russell 2000 closed slightly green, those indexes were still well into oversold territory, according to certain internal indicators. We should expect a continued move higher next week in the indexes, based on these conditions.This market is not for the faint of heart. This is a trader's market, pure and simple. Just when the bears were out in force this week, calling for market tops, we are nowhere near that type of signal after Friday's market rebound. Based on internal signals, the trend remains bullish. As I have stated on different occasions, the trend is a three month or more month time frame.
The S&P 500 is not close to that bearish signal. At one point Friday, the S&P 500 index came within 12 points of its all-time closing high. That is certainly not a bearish sign. Until this market breaks the necessary technical levels to become a bearish trend, traders and investors alike need to play this market from the bullish perspective. If not, money will be lost and many long opportunities will be missed. Next Tuesday, the markets begin the month of April with a clean slate. There will be no more quarterly squaring up of the books.
This has been a flat stock market for the first three months of 2014. Gold and utilities have been the leaders. The dollar and interest rates are burning. The consumer is feeling the inflationary pinch. This is not a good recipe for continued stock-market growth. At some point, the markets will reflect this negative headwind. Until then, let the markets be your guide, as the trend is still higher. Two positions that I mentioned in Thursday column that were purchased and sold on Friday were Las Vegas Sands (LVS) and Hologic (HOLX). Both were sold for nice gains. On Friday, Orbitz (OWW) and Safeway (SWY) were added as long purchases. Currently, both companies are extraordinarily oversold, according to internal indicators. At the time of publication, the author held positions in OWW and SWY, but positions may change at any time. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV