April 28, 2010
U.S. Stocks Rebounding after Asian Markets Bottom
U.S. stock markets are trading higher ahead of the opening after hitting oversold levels and bottoming in Asia. Traders took the markets lower overnight in a
follow-through break following Tuesday’s sell-off, but after reassessing the financial situation in Greece and the general lack of fresh sellers, turned the markets around on bottom-picking and
short-covering.
Traders are still cautious about being long at current levels due to value issues and worries that the financial crisis in Europe will escalate further. Nonetheless,
investors feel that yesterday’s break may have been overdone to the downside and too much of a knee-jerk reaction to the news of the S&P downgrade of Greece and Portugal’s credit ratings. This
type of reaction usually generates a sizeable retracement. If traders still feel that they want to take risk off the table, then renewed selling pressure is likely to occur after a 50% rebound of
Tuesday’s sell-off.
Technically, the June E-mini S&P 500 turned the main trend down on the …
