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My indicators are giving neutral to slightly bullish readings this week, which is about where they’ve been for the past few weeks. We are presently in the longest-ever period of time in which the S&P 500 has not seen a correction of at least 3%.
The “FANG” stocks — Facebook Inc (NASDAQ:FB), Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX) and Alphabet Inc (NASDAQ:GOOGL) — have been the leaders of the current rally, as they have moved up roughly twice as much as some of the other Nasdaq stocks. In fact, there are so few bears right now that S&P put options have almost never been cheaper.
One reason for that is that the S&P 500 Volatility Index is so low, although it has shown some strength this week. Tuesday’s one-day reversal would usually have been a negative for the market, but the fact that the S&P closed higher the very next day goes to show just how strong the current market is.
While I do still recommend having some portfolio insurance on hand, as the rally will end eventually, I remain in the bullish camp and do not plan to fight the tape. Today I’m recommending a bullish trade on Snap Inc (NYSE:SNAP).
Buy to open the SNAP Mar 15 Calls (SNAP180316C00015000) at $0.95 or lower.
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