Today was a wash for me as a migraine or one equivalent to that left me unable to do much of anything, causing me to sleep through the close, which almost never happens. However, today was constructive from a long standpoint even with the late day meltdown. You don’t want the indexes to bounce too hard as that would be unsustainable with sentiment being overly-optimistic, and you want to leave enough room to give the shorts hope that this market is going to collapse, which is what the late day selloff does.
Let me be very clear about my stance on the market right now. I’m not bullish as my signal hasn’t flipped yet, however there are present some qualifying things that need to happen if the market is to bounce at these levels. My positions in the indexes are speculative at the moment as I feel that remaining ultra bearish would be a mistake when there are some good things going on in the markets.
The Dow closed right at support below while the Nasdaq got rejected at it’s upper trendline, but does have a little bit of wiggle room to fall further (indicated by blue dot). I’d like to see a gap lower with the gap being filled in the second part of the day to give some reassurance that we have found a bottom. The futures are mildly bearish as I write this.
One stock I really like is HOC, and will be looking to open a position tomorrow. Other scan winners today were AVGO BR RBN LLL CVI.
