We Got Our Rally: Now What?

All I can say is "Wow!"

We all knew that something was brewing. That's why I noted after Monday's selloff near the lows of the year that "it smells a bit like market-makers - the institutional folks whose computers act as middlemen for stock trades - are trying to engineer a rebound in the next few days."

And quite a rebound it was, getting a running start even before the Fed announced its quarter-point rate hike on Wednesday afternoon, and never looked back.

In 4 sessions last week...

• The S&P 500 rose nearly 7%.
• The Nasdaq Composite jumped more than 10%.
• The DJIA gained more than 5%.
• The Russell 2000 rocketed more than 7%.

It's great to see a rally like this.

But the one nagging thing that bothers me is mainly that the rebound was so quick and basically, all straight up.  I prefer rallies that start slowly, and give people plenty of reasons to dismiss the action, and not buy stocks.

Last week's was just the opposite. It was pure "FOMO" - fear of missing out. So the concern here is that everyone may have gotten very bullish, very quickly.

That's not necessarily a problem. But the best, longest-lasting rallies tend to unfold slowly, with lots of doubters and fence-sitters as the market rises, which was definitely NOT the case last week.

But we'll just have to deal with it. We wanted a strong rally. We got one.

One thing I'm wondering about though...we have almost 2 weeks left before the end of the quarter.

So just keep in mind that the market could still be subject to some drip-drip-drip selloff days as fund managers use last week's strength as an excuse to book profits as the end of the quarter draws near.

The portfolio itself did very well last week.

If you've done a good job "catching the bottom" (as we have in our stocks ahead of last week's rally) the key in these kinds of situations is to not get too fancy with trading in and out. For big +100% profits over time, it's better to just sit on your hands: