This Time Won't Be Different 2.0

Last week, I said that those who were telling us that there were no signs of "froth" in the markets were closing their eyes to all signs of a new bubble. Let's check in on the lovelies to see what happened in the last week...

LinkedIn, got unlinked - reminding us what happens when market darlings don't meet earnings expectations and the stock is already vertical:

Angie's List, coming off the boil:

Fleetcor: Gapped up on heavy volume Friday, but gave most of it back by the end of the day. How we would expect a multi-month rally to end...

Lumber Liquidators: Still doing the vertical suspension 'thing', but carved out a lower high during Friday's Risk On lovefest...

Johnson & Johnson: Rolled over, but made a gap up high on Friday - will it be an island gap (downside reversal), a breakaway (upside) gap or an exhaustion (gap and crap) ? Tune in next week...

Nikkei: Testing the vertical uptrend line w/no room for error. Sunday night cliffhanger...

Bonus Chart: Canadian stocks which are leading global indices down, gapped up Friday, but gave most of it back. Anything tied to commodities - including the commodities themselves - is now broken aka. the world economy:

On Friday, the Dow and S&P 500 made new all time highs on tepid volume while the leading stocks lagged the overall market. It was an algo driven short-covering rally in the most beaten down stocks, leaving the market overall overbought. This coming week should be interesting to see what games, if any, the HFT bots have left to play.

My hypothesis is that the goal of this market is to get as many hedge funds to give up their hedges as possible, just prior to heading straight down. So far, the vertical ascents, up/down head fakes, constant sector rotations and low options volatility have done their part to make hedging extremely unprofitable. So now, we'll see about the second part...