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As I watched the Standard and Poors 500 index (SPX) trade upward so strongly today on the news of agreement on a final tax reform bill, I couldn’t help but think of that old television show, Happy Days. Are we off on another leg up of this remarkable bull market? Are Happy Days here again?

SPX spiked to another all-time high today, closing at 2676, up just under one percent. But the spike in trading volume was truly remarkable. Trading volume for the S&P 500 companies ran below the 50 day moving average (dma) at 2.1 billion shares all week. But today’s volume hit 3.5 billion shares, the highest level seen in SPX all year. It certainly appears to have been an “all in” day as the poker players would say. But is that appropriate?

I think most, if not all, market analysts would attribute today’s spike to the news that a final version of the tax reform bill was ready for release and congressional leaders think they have the votes for passage next week. But passage in the senate is anything but a slam dunk. That fragile majority could easily unravel. If that happens, look out below!

I also worry about the market’s reaction to passage of the tax reform bill. Will this be another “sell the news” moment?  In many ways, my position on this market hasn’t changed. I continue to play the bullish market trend, but I am increasingly cautious.

The volatility index for the Standard and Poors 500 index, VIX, remains relatively low. VIX opened the week at 9.7% and rose to 10.5% on Thursday, but closed today at 9.4%. VIX tells us that Happy Days are indeed here again. But that worries me. Maybe we are too comfortable. The market has been rather volatile over the past couple of weeks. Many of the market darlings have been whipsawed back and forth. Passage of a tax bill will certainly push the market higher, but it could also be a “sell the news” moment. The spike in today’s market worries me when the bill’s passage is anything but certain. Black swan events have a tendency to occur when everyone is fat and happy.

Be cautious. This is a nervous market and next week could bring some big moves higher or lower. Keep a close watch on your positions and set tight stops.