It may not feel like it — especially for Netflix NFLX, +1.18%[1] shareholders — but Jeffrey Saut, chief investment strategist at Raymond James, says we could be in the midst of a “buying stampede.”
That’s a phrase Saut claims he coined back in the 1970s to describe rallies typically lasting somewhere between 17 to 25 sessions, with only brief pauses of up to three sessions. Four sessions in the red, and poof, just like that, the stampede is over.
“It appears to be the rhythm of the thing in that it takes that long to get everybody bullish enough to throw in the towel and ‘buy ‘em’ just in time for a trading top to arrive,” the strategist writes in a blog post[2].
If this is, indeed, one of those stampedes, says Saut, who provides our call of the day, we’re just 11 sessions into it, which means a burst of buying is on the way. Overall, he describes the current climate as a “stealth bull market” that’s setting up to deliver more all-time highs for the major stock indexes.
Why is it stealth? He recently explained to CNBC[3] that while the Dow Jones Industrial Average DJIA, +0.18%[4] is just barely higher for the year, the S&P SmallCap 600 SML, -0.45%[5] and the Nasdaq COMP, -0.26%[6] are both up double digits.
“Clearly, the U.S. economy is hitting on all cylinders and business optimism, for whatever reason, is leaping,” Saut said. “We will get more news on the economy this week.” (See The economy section below for more on that).
As it stands now, the premarket action doesn’t look like a buying stampede.
The market
Stocks ended Monday mixed[7], and it looks like they could start Tuesday with a small drop. Futures for the Dow YMU8, -0.13%[8] , S&P 500 ESU8, -0.10%[9] , Nasdaq-100 ...