EU Economic Activity Picking up, so is US stock Market

European economies rose to the highest level in over four years, with the two biggest economies, Germany and France, leading the way. US Stocks ran to the upside on the open with this news but then, sticking to script, just grinding in a trading range the rest of the session.
Leadership once again was by Tech ($QQQ) and the Small-Caps ($IWM). What is most notable, is that both the NASDAQ ($QQQ) and the Russell 2000 ($IWM) both hit new highs which is a huge catalyst for the Large-Cap ($SPY) bulls.

I mentioned on Friday what I did not like the action in the Finance ($XLF) and Energy ($XLE) sectors. That moved to the upside on Monday’s trade, with both sectors leading the way. Further upside challenges by these two sectors could turn this recent rebound into a potentially new short-term, upside trend.

I will be keeping a particularly close eye on Energy ($XLE) stocks and use the action in Oil ($USO) as a guidepost. $USO continues to grind lower within a falling channel and has not been able to break this pattern. Watch this action in Oil ($USO) closely for potetnial clues to the next move in Energy Stocks ($XLE). Finally, Biotechs continue their rally as both Biotech sector ETFs, $XBI and $IBB, hit new highs.

Have a great trading day.