The S&P 500 added 0.34% Tuesday, bouncing back from Monday’s modest decline. This makes it 10 up days out of the last 12 trading sessions. Not bad.
Headlines remain benign during these slower summer trading sessions. Not much is going on and the market’s half-full mood keeps shrugging off all of the reasons stocks should be lower.
And so far, there is no indication anything is going to change anytime soon. Monday’s 1% midday swoon would have broken a weaker market. Instead, most owners shrugged and kept holding. Say what you want about complacency, but when confident owners refuse to sell, that makes it really hard for any selloff to establish a toehold. And as such, the index finished Wednesday at yet another record close.
After-hours futures are down a quarter of a percent and maybe that means stocks open lower Thursday. But if a person believes a trend is more likely to continue than reverse, any near-term weakness is simply giving us another buying opportunity.
Until selling pushes the index under 4,250 support, I’m holding for higher prices.
As well as the indexes are doing, the meme stocks cannot catch a break. GameStop (NYSE:GME) fell under $200 support and AMC Entertainment Holdings (NYSE:AMC) was rejected by $60 resistance.
I wrote on these pages back in May that GME’s $200 breakout was buyable and the same applied to AMC’s $15 breakout. While I’m no fan of these stocks, I trade the market and when it tells me to buy, I buy. And the same applies when it tells me to sell.
No matter what you think about these stocks long-term, they have been flashing sell signs for a while. When AMC struggled with $60, that was our signal to lock in profits. The same followed GME’s failed flirtation with $300.
Remember, we only make money when we sell our winners. And guess what? If we sell too early, we can always buy back in. It is far easier to do that than it is to wish a stock back up to a level that we regret not selling at.
As for what comes next, there is zero excuse to hold GME under $200 and there is still time to lock in respectable profits in AMC before this one retreats back to support.
As for entry points, GME is buyable only if it reclaims $200 support and AMC is buyable when it breaks above $60 resistance. Until then, these are very clear sells.