Good evening StockBandits!
With last week’s extreme selling pressure leaving the indexes somewhat oversold in the very short term, the market was poised for some kind of bounce heading into today’s session. And that’s just what we got. The only problem was that it was incredibly weak. To say it failed to impress would be a huge understatement, so to be more blunt, it was downright pathetic.
Not only were the net changes by the closing bell just a drop in the bucket to what was lost last week, but at no time during today’s session was a real upside run even made. We saw the market gap higher, but no momentum ever surfaced. The S&P 500 modestly cleared its morning highs during the afternoon, but that only led to another round of selling which left the market limping to the finish line, ending the day only higher by a few points.
So tonight, we have a pair of elements which are worth noting – one psychological, and one technical. The psychological element is that the bears suddenly feel alive again. Not only did they have some downside follow through last week for the first time in quite a while, but the inability of the bulls to fight it is still incredibly lame. That is confirmation that the character of this market is changing. The technical element worth noting is that today’s bounce only produced an inside day on the daily charts. Often when found within a trend, inside days lead to follow through, which doesn’t bode well for tomorrow. After all, if today’s rebound was the best the bulls could muster after such a sharp decline in the previous sessions, then they’re likely to want to raise more cash in light of such a poor bounce (so far).
We do have an FOMC meeting on Wednesday which could be used as a catalyst for a move in either direction, depending of course on what the Fed says. And traders may have been exercising caution today ahead of that, but it’s still got to be disheartening to the bulls to see last week’s downside slam get followed by such a meager gain today.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
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Video Stocks Discussed: PXP, SJT, AMLN, AMSC, CTRP, COH, MMR, GCI, IT, IVN, CXW, BTU
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
PXP, MMR, PRXL, TLB, SJT, GCI, IT, AMLN, JEC
Bearish Watch:
NFLX, IVN, CXW, DECK, CP, IMAX, M, BTU
The Hit List will be coming out soon with discussion on open positions and swing trade stops and targets, so be sure to watch for it.
