Another strong rally

Powerful rally. The difference here is that for the last months, rallies have only lasted a day or so before the sellers came out of the woodwork. Today, the markets rallied strongly on big volume. That qualifies as accumulation days for both the S&P 500 and Nasdaq, the second in the last three sessions. The SPX is now above its 50-day, and the bears are nervous.

Housing and chips stocks led, with drug stocks lagging, but most other groups participated nicely. Breadth was solid, with the hi/lo index for the S&P and Nasdaq expanding.

Tomorrow brings most of the retail sales reports. While I don't expect most of them to be very strong, I think much of the downside is already priced in. So I would look to accumulate my favorite retailers on any short-term weakness. I think the 4th quarter rally is now underway.