10May12:46 pmEST

The Zen Theory of the Stock Market

I once had a law school professor quickly regain control of a class which had gone off the rails. Too many students were questioning the vast inconsistencies in the case law we were studying, and the class had broken down into students basically bloviating for much of the class time about what they thought the proper law should be. 

"You must learn to accept the vast inconsistencies in the law and let it wash over you. I call it the 'Zen Theory of Tort Law,'" he said.

And so it became a running joke between me and some of my classmates who were not caught up in the melee, regarding the idea of a Zen Theory of Law.

Similar comments may very well apply to the current market using, ironically, ZEN as a ticker symbol.

On the software growth stud's daily chart, below, we see a strong sideways basing pattern in a clear uptrend once again defying market weakness today. 

But how can this happen when the indices continue to struggle and small caps going from hero to seemingly zero since Monday?

Which chart is lying and which is telling the truth? 

Ah, another major inconsistency which could easily have you doing mental gymnastics and growing frustrated. 

According to the Zen Theory, we should let these inconsistencies also wash over us and understand that the relative strength by ZEN may be an absence of sellers in such a strong growth name, meaning we either are not yet at the stage in the market where we see broad-based selling without discriminating against the best growth names like ZEN, or instead we are market time before the likes of ZEN eventually lead us higher when the market firms up. 

In the meantime, bears and bulls alike will cherry-pick their respective scenario, above, and claim the outcome is inevitable. 

However, for now all we have is the reality of a headline-drive, indecisive market which has kept me sidelined since Tuesday and may do so into the weekend if the vast inconsistencies prevail. 

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