Last week we wrote that fundamentals were good for the stock market.

At the end of the week, the surprisingly strong employment report confirmed that conditions might even be getting better.

During the week we had a conference with our technical research consultants. They look at the market from investor supply demand indicators for stocks. (We look at fundamentals, so we like to get another view point.) As long as more money continues to seek new investment than leaves to seek safety, markets are likely to move higher.

Markets often top and go into decline well after the point where money flows reverse. Smart money often starts reducing holdings well before an obvious turn (sneak out the back Jack).

The good news is that money is still coming into the stock market; this shows strong demand. What we want to know next is specifically where is money flowing; what sectors and what stocks. Our technical research consultants track that too. So we get a chance to confirm our own research or perhaps indicate that we need to look elsewhere.

We are happy to report that sectors where we previously reported should show outperformances are still showing money inflows. More on this next week.