Phil's Stock Market Blog

I'm starting to think the "top" we identified a couple weeks ago may have been strictly a short-term thing. As of this morning, before the open, the index futures appear to be breaking out to yet another high.

The early-morning action can be very deceptive, for example the markets can gap higher on the open and then sell off all day, but this time it might be real. We've noticed that leading stocks appear to be hanging in there for the most part, not getting hammered. With a real market top we will see the leading stocks starting to fail across the board, but at present all we can say that the leadership is "narrowing".

Another signal of a top: Stocks have done well for a while, and you get very bullish and go on a buying spree. But then your purchases don't do very well. It seems like you bought all the wrong stocks, but really this indicates that the market is topping out. Either that or you're a really bad stock-picker! Judge for yourself.