Quiet Stock Market Action is Healthy

As a finance professional and someone who follows the stock market closely I fully admit that stock market observers tend to be a group that worries quite quickly. You can't really blame them now, since it was just a year and a half ago that the overall economy was in its worst meltdown since the Great Depression. The issue that I have now is it seems that investors and analysts seem to be worrying about the current action when there is nothing to worry about.

In recent weeks the stock market has moved up very slowly and steadily, but without very much volume on the upside. It seems that rather than the market jumping higher as everyone piles in, what is happening is the market is churning slowly higher because no one wants to sell in the current environment. I understand that it is always nice to see huge volume when the stock market is moving up, but in this particular case one has to consider the facts and see that the market's actions are very healthy right now.

What exactly are the facts to consider? Consider that after the stock market moves up in a big way for a sustained period of time there is commonly a time period where the market digests that move. Sometimes during the digestion period stocks will drift lower and other times they will slowly churn higher. After more than a 60% run up from the lowest levels hit in March of 2009, I really do believe this market was due to take a pause and digest its gains. After a short period of an 8% slump, the market has perked up and edged its way higher.

What is the biggest lesson to learn from all of this? The single biggest lesson for investors here is that while some traders or analysts might not be happy because the market is simply meandering its way higher and there aren't huge swings for them to trade, you can still make money in a market like this. Sometimes a market that is proving to be very resilient and just edging its way higher over time can be the best market of all to invest in. There are always going to be complaints from market technicians about something, but sometimes you have to tune them out and see the market for what it really is at the current time.