Currently, the overall tone of the market is positive as it continues to act very well. Additionally, the number of Industry Groups participating in this uptrend is broadening. On the stock side, chart patterns look substantially better than 4th quarter last year; they are tighter and more uniform. Although I am expecting a short-term pullback around this level, I remain positive on the market environment. I am continuing to gradually increase my exposure as opportunities present themselves, which is effective as most breakouts are working. Since we are extended, discipline is instrumental to holding through any short-term weakness. Bernanke's comments today were realistic and sobering; however, let the stock charts and the index charts guide you, not the news.

 

Best Returns,

 

Scott O’Neil

President, MarketSmith Incorporated

Follow Scott O'Neil at Twitter.com/WScottOneil