Earnings season came in like a lion… and out like a lamb.
I'd written over the last few weeks how we might see some fireworks during earnings season.
My spidey-sense went off because:
- The Nasdaq 100 relative strength index (RSI) was at its highest point in 10 months
- Market breadth (measured by the McClellan Volume Summation Index) was at its lowest level since November 2020
- All five "mega cap" stocks reported earnings this week
And while we have had a few -1% and -2% pullbacks since, it looks like those fears were overblown.
Unlike the last two earnings cycles that saw major selloffs despite strong earnings, this cycle has been much tamer. We've seen mild pullbacks in Tesla Inc. (TSLA) and Facebook (FB) post-earnings but nothing like the last two cycles.
That's not to say we're...