The Short-Term Uptrend Has Been Re-Affirmed

If you missed it, here is what I said yesterday.

The short-term uptrend has been re-affirmed, so I have to back off on my short-term bearishness. 

There were some very good comments about the market today. On FastMoney, someone mentioned that there is a strong possibility of significant tax cuts for businesses... whether you like it or not. And you have to position your portfolio correctly and be prepared for it. That is, be prepared for a very bullish outcome for stocks.

The bullish percents continue to confirm the uptrend. I believe the weakness in the NDX is a rotation out of large cap tech stocks due to the prospect of higher rates.

(Click on image to enlarge)

The Leader List

The long-term leaders are blue, the short-term leaders are green and the ETFs that are showing recent strength are shown at the bottom. The S&P 500 is the benchmark. Disclaimer: This list is not a recommendation to buy or sell.

Not much happened today, but the rotation over the past couple of weeks has been dramatic.Financials, Small Caps, Energy are now leaders.Emerging Markets, Technology have dropped off.

The rotation is related to the prospects for higher rates, a higher US Dollar and Federal Tax Cuts.

Biotech is showing a very nice chart.

(Click on image to enlarge)

Outlook

The ECRI index is pointing to weak economic growth in the months ahead. Maybe the prospects of a tax cut will help the ECRI bottom out and start to head higher soon.

The long-term outlook is worrisome.
The medium-term trend is up.
The short-term trend is up.