Image Source: Pixabay

After the first four days of tepid upward action, the market decided to take Friday off for the Labor Day Holiday weekend. Some people might get twitchy about this, but without the benefit of hindsight, there’s not much to get too anxious about.

The indices are a bit overstretched, but that didn’t stop nearly every stock in my “little list” from rising, some spectacularly so.

Market Outlook

Our market commentary continues to be outstanding. Mastering market timing enables you to swim with the tide at the right time. Last week, I said, "I expect broad bullish follow-throughs from solid bullish post earnings setups."

This was spot-on, with nearly every stock highlighted moving up.

With next week being a four-day week starting on Tuesday, and with one hour being a long time in these markets, I’m going to be neutral in terms of the indices. They could use a slight pullback, while the stocks that are shaping up nicely should continue to be attractive, provided nothing dramatic happens in the meantime.

Market Timers

• Longer-Term Market Timer (OVIsi): Green.
• Medium-Term Swing Timer: Bullish.
• The Main Indices: The DIA and IWM (completely different indices) continue to have decent blue OVIs. The SPY slightly less so but still blue, and the QQQ popped back into blue before dipping down into negative territory.

Stock Selection

This weekend, I’ve once again focused on my usual preferences with a lean towards post-earnings setups. The key to consistency is to pick your playbook and stick to the best quality setups that conform to it. If the setups aren’t there, keep your powder dry for another time.

My playbook is OVI, near Key Levels, Shrinking Retracements, and a consolidation/sideways move. The other two 'Big Money Footprints' are highly desirable, but those four are essential to me. Increasingly, I’m researching the resulting impact of very short-term momentum, and I’m also now looking more at overbought and oversold issues.
 

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