Is it sell in May and go away?

The Market had a good run this past week and the question on every one’s mind is it time to take gains off the table and bank them. The old saying of sell in May and go away may be very much the case this year. The long term charts are indicating that a pullback is due but the short term charts are still  going higher. The gain on Friday last was a surprise and the markets are now at an all time high. The stimulus of $85 billion a month is helping the market and I really wonder what will happen when this stops. We seem to be looking at a very false market right now. I always say the trend is your friend and the trend is up right now. So let’s see how long more it will last.

The only stock I feel comfortable with right now is Apple Inc. (AAPL). The long term chart looks good. The stock has a nice run last week and the market rally has helped it. The stock broke through the 50 day moving average during the week which is a good sigh that confirms its reversal up. A number of things still worry me including the fact that its money stream is still weak and the stochastic is high at this stage which indicates that it may pull back from its current levels. I am expecting that it will come back and test the 50 day moving average at some stage over the next few weeks. If the market pulls back in general than I would not be surprised to see Apple retesting its recent lows of $400. On a positive note though, we have seen good gains last week, the 10 day has crossed the 20 day moving average and the stock is trading between the 10 day moving average and the top of my Bollinger band. I am happy with the stock once it stays above my 10 day moving average.

That is all for now. I will be back with you during the week if I see anything interesting happening. Enjoy the rest of your weekend.