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Up, up and away! The S&P 500 rose 1.52%, the Dow advanced 0.96%, and the Nasdaq climbed 2.82% last week, aided by Federal Reserve Chairman Jerome Powell’s dovish commentary.

There is no doubt this year’s rally has been one of the most impressive rallies market participants have ever seen. More than 50 new closing highs and over 200 trading sessions without a 5% pullback defines the power and consistency of this rally. And as we have all witnessed, the slightest pullback seems to act as a frenzied feeding ground for buyers.

Fueled by better-than-expected earnings last week the S&P 500 rose 1.6%, the Dow climbed 1.1%, and the Nasdaq added 1.3%.



Despite the strong week, on Friday traders’ enthusiasm for the recent rally faded a bit after Fed Chairman Jerome Powell’s commented that the central bank was “on track” to begin reducing its purchases of assets.



However, Monday the bulls stepped right back in and once again “bought the dip.”



This week brings earnings announcements from key mega-cap tech names Amazon (AMZN), Facebook (FB), Alphabet (GOOG), and Apple (AAPL). There is also a bevy of blue chips reporting including United Parcel Service (UPS), Visa (V), McDonald’s (MCD), Coca-Cola (KO), Boeing (BA), Merck (MRK), Caterpillar (CAT) and numerous others. Brace yourself, it’s going to be exciting!
Energy has taken off lately and I want to add exposure to the sector. However, I still want to maintain a somewhat conservative stance, especially as this week’s pick will report earnings next week. As a result, I will be selling in-the-money calls on hydrocarbon explorer Marathon Oil (MRO).

Shares of Mindbody (MB) are racing higher today after the company delivered revenue growth of 35.4%, and Shares of LeMaitre (LMAT) are also rallying over 10% after the company reported Q3 revenue growth of 22%

Dave & Buster’s (PLAY) has dipped back toward the top of its prior launching pad as many restaurant stocks have sagged. We’ll place the stock on Hold and keep it on a tight leash. And today, Vulcan Materials (VMC) fell sharply after missing earnings estimates, partially because poor weather in the second quarter delayed construction projects. We’ll respect the stock’s action and move VMC to a Hold rating tonight.

The Emerging Markets Timer is still pointed up, despite the market’s recent consolidation. Our moves tonight are increasing our Buy recommendation for Alibaba (BABA) to a full position, lowering our rating of Telkom Indonesia (TLK) to Hold a Half and returning Weibo (WB) to a Buy a Half recommendation.

We had a terrific week with the vast majority of our stocks, supported by a 0.8% rise in the S&P 600 Small Cap Index. That’s not a big move, but given the recent break-out to all-time highs, a little follow-on strength across the board suggests the market could be setting up for another run higher.

Oil prices and energy stocks have strengthened, so I’m putting Pembina Pipeline (PBA) back on Buy today. However, I’m moving Costco (COST) back to Hold after the warehouse retailer’s latest sales results caused the stock to pull back once more.

Despite the continuing Buy signal from the Cabot Emerging Markets Timer, one of our stocks, Telkom Indonesia (TLK), is not pulling its weight and is now rated Sell.

Not much has changed in our portfolio, though Home Depot (HD) did report solid earnings on Tuesday.

The market continues to act just fine, with the major indexes generally trading in a tight range. Tight trading isn’t necessarily bullish; if it occurs after a multi-month run, it can be a clue to exhaustion in buying pressures. But coming so soon after an initial thrust out of a big trading range, it’s probably a sign that the sellers are out of ammunition.

The rebound in emerging market stocks has given us a new buy signal. We’re going to complete our position in Weibo (WB) by buying another half position, and take a full position in NetEase (NTES).

Remain bullish. The market is in good shape, and we’re starting to see some growth stocks reassert themselves. There are still some potholes out there, but we believe you should remain heavily invested. In the Model Portfolio, we sold Five Below (FIVE) on a Special Bulletin yesterday, replacing it with GrubHub (GRUB), and today, we’re placing Facebook (FB) back on Buy.

This morning, Janet Yellen seemed to indicate (like many Fed speakers in recent days) that a rate hike next month is on the table. But the market doesn’t seem to mind, with the major indexes flat-ish in volatile trading.

We may look to exit a few positions on strength over the coming weeks/months, but those moves will depend on share price momentum and/or earnings results. More companies have announced their earnings release dates, and three companies report next week. We have no ratings changes this week.

It looks like one of our stocks may be falling prey to a change in regulatory action by the Chinese government. Sell Yirendai (YRD).

We’re leaving our Market Monitor where it was on Monday—at level 7 out of 10. We think holding some cash is appropriate (maybe 25% to 35%, depending how your stocks are holding up), and we’d probably keep new positions smaller than normal for the time being.

Stick with a lean-bullish stance as we wait for the market to show its hand. Our Cabot Trend Lines and Two-Second Indicator are still bullish, but our Cabot Tides remain effectively neutral, and until that changes, stocks and indexes will see lots of choppy action. In the Model Portfolio, we’re sticking with our current 30% in cash and our crop of seven stocks.

The major indexes are relatively flat this week as the market continues its tight, choppy trading range that’s been in place since early September. Because of that, our stance remains unchanged—our Market Monitor is at a level 6 out of 10, and we advise holding resilient stocks but also holding some cash, while being selective when doing new buying.

Ulta Beauty (ULTA) has likely formed an intermediate-term top after sinking on earnings during the past three days.

The market continues to move sideways, at least in the intermediate term, as investors can’t seem to get past the usual suspects of an unpleasant election, an uncertain Fed and a mix of Brexit, Deutsche Bank and other ongoing dramas.