Did the Market Just Bottom?
Hi everyone,
Let’s dive right into today’s (Thursday’s) action. We’ll cover the general market and then individual stocks that are standing out.
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The General Market
After an initial gap-down as severe as 3%, the Market rallied strongly from the open and closed near the very top of its range.
This feels like the start of a potential character change as the market reacted positively to negative news with the high CPI reading.
The QQQ closed up over 2.3%. There were still net new lows.
The SPY finished up 2.64%. There were new net lows on the NYSE.
The IWM was up 2.48%.
The VIX dropped nearly 5%. It remains above a rising 21ema
The T2108 rallied strongly forming a higher low.
The McClellan Oscillator opened in “oversold” territory and rallied strongly.
Trends (3/4 Down)
Short-term: Mixed (above a declining 5 sma)
Intermediate-term: Down (below a declining 21 EMA)
Mid-term: Down (Below a declining 50 sma)
Long-term: Down (below a declining 200 SMA)
Overall Thoughts
Today was certainly constructive, what remains to be seen is whether this momentum continues or we give it all back shortly. There are often many 1 day incredible moves during corrections.
I want to see the market back and fill a bit, be supported, and form higher lows above the 21ema. Market leadership has to shape up with multiple groups acting well and providing setups.
Did the Market Bottom today? It’s possible but there is no need to dive right based on FOMO. Be patient and selective with new buys in promising stocks. As the market rewards new buys and provides positive feedback, then you can increase exposure.
Today was a good one-day move, let’s see if it becomes something more. Remember that there are often sharp moves from oversold conditions.
Keep watching price action day by day and managing risk.
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Have a great week!
-Richard
Not even close.