The stock market's rebound to record highs from its September/October swoon is fools' gold, says Hayes Martin, president of investment consulting firm Market Extremes.
Martin called the market's correction in late September and then the bounce in mid-October, says Mark Hulbert, editor of Hulbert Financial Digest.
Now Martin is concerned about "subsurface" weakness in the market's rally of the past three weeks,
Hulbert writes on MarketWatch.
"A most telling weakness, according to Martin, is that the market never exhibited the kind of explosive upside action that is typically seen 'early in a strong market advance off important lows,'" Hulbert says.
Not a single session has seen trading volume for rising stocks total at least nine times the volume for falling stocks.
"This is noteworthy because, as [market expert] Marty Zweig wrote in 1986, 'every bull market in history, and many good intermediate advances, have been launched with a buying stampede that included one or more 9-to-1 up days,'" Hulbert says.
The recent rally might be "an interim bottom within a longer-developing top," Martin notes.
The S&P 500 dropped 10 percent from Sept. 19 to Oct. 15 and has since rebounded 11 percent.
Meanwhile, stocks slid after Friday's October jobs report, which showed a non-farm payroll increase of 214,000 in the month.
"It was an ok report, but it doesn't give any sort of indication that there's any kind of acceleration in economic activity," Peter Sorrentino, a fund manager at Huntington Asset Advisors, tells
Bloomberg.
"We're not hugely disappointed, but we don't see any sort of positive surprise here at all."
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