Bulls are in Full Control

Gary Kaltbaum is an investment advisor with over 18 years experience, and a Fox News Channel Business Contributor. Gary is the author of The Investors Edge. Mr. Kaltbaum is also the host of the nationally syndicated radio show "Investors Edge" on over 50 radio stations. Gary is also editor and publisher of "Gary Kaltbaum's Trendwatch"...a weekly and monthly technical analysis research report for the institutional investor. If you would like a free trial to Gary's Daily Market Alerts click here or call 888.484.8220 ext. 1.

I will repeat a line I have been saying for weeks: UNTIL MAJOR INDICES BREAK SUPPORT AND OR MOVING AVERAGES, THE MARKET GETS THE BENEFIT OF THE DOUBT. I am stating this again because I have seen many turn bearish in the past week over the recent distribution that has occurred in the NASDAQ/NDX. I do not disagree one bit with the fact that the NASDAQ and the NDX have been under pressure. I do not argue with the distribution days. I just argue with everything else.

The DOW, S&P have inched out to new highs. These two major indices have not even been tempted to correct. But now...and more importantly:

The RUSSELL 2000 breaks out to new highs.

  Charts courtesy of StockCharts.com

The MIDCAP 400 breaks out to new highs.

  Charts courtesy of StockCharts.com

The SMALLCAP 600 breaks out to new highs.

    Charts courtesy of StockCharts.com


You want more, the INDUSTRIAL SECTOR has broken out.

The TRANSPORTS have broken out and have skyrocketed the past 2 days.

  Charts courtesy of StockCharts.com

In the past week, STEEL has gone nuts to the upside...ALUMINUM has followed suit...other COMMODITIES ditto.

In the past couple of days, anything to do with CONSTRUCTION, CONSTRUCTION PRODUCTS, TRUCKING, RAILS, HOTELS have lit up like a pinball machine. My previous thesis that the market is forecasting a stronger economy is on cue. These areas would not be lighting up if the economy was not accelerating. The market is the best forecaster...not someone's opinion.

I know the NASDAQ and NASDAQ 100 had failed breakouts. I also know that leading names like AAPL, GOOG and a few others have topped. I know the SOX continue to lag as badly as could be. I am just letting you know that other areas are now front and center. ..and while I said in my last report that I was seeing action indicating some of these areas were perking up, I in no way believed we would see such a huge pop in stocks like MHK, MAS, X, JCI, CMI, CLF, PKX, PCU and others....a big wow!