Stocks were supported a day after a nasty selloff. A very poor durable numbers report, the lowest in six years, didn't help at the start of the day. Thankfully, for the bulls, that was the worst of it. Stocks spent the rest of the day treading ground until the final hour when they made the push to close green.
At the close, the Nasdaq and SP 500 led the way with .3% gains, the SP 600 followed with .2% gains, and the DJIA ticked up .1%. It was better than more losses.
Volume was a tad higher on both the NYSE and on the Nasdaq, according to my Telechart charts. However, IBD has both the NYSE and the Nasdaq with volume a tad lower. Either way, it is counting hairs. Volume was basically flat. Not good, not bad, not easy to see what the true intention of market players were.
Breadth was positive on the NYSE with advancers beating decliners by a 5-to-3 margin and on the Nasdaq advancers and decliners were pretty much flat.
Few stocks got whacked today. So that and the small rebound is pretty good considering what yesterday brought traders. The bad news about this rebound is that lagging stocks made the best gains. This action has the feel of a market that is going to rotate some stocks around from laggards to leaders, on a short-term basis. If that is the case, the market should be making little headway from here. I hope this is not the case. If leaders start leading again to the upside, all this thought will be irrelevant.
A pullback, remember, is welcome here. It is not healthy for a market to keep rising non-stop without having any mini downtrends along the way. Pullbacks allow stocks to start consolidations. A lot of nice stocks should create some strong bases to breakout from, if this pullback is just a minor pullback in the making. So far the jury is out so it is not smart to make a bet one way or the other.
If stocks don't form good bases during this pullback, that will be my cue to be very careful and to get ready for further weakness. If the market starts selling off, because the bulls can not deliver more upside, I will start to take the proper action. This is always a possibility as bears become more bold the longer it takes for us to recover the losses.
The upcoming days are key. Further upside would really discourage the bears and leave them scrambling as momentum would obviously pick up with traders seeing that the bears can't even follow through on a big selloff.
If the bulls don't show up, however, I won't be surprised one bit. We are too extended and a pullback of 2 to 3% would seem reasonable here.
We have 3Q GDP and the Fed beige book coming up tomorrow. I hope everyone did well today. Aloha and I will see you at Investors Paradise.
New Swing Longs: CRT IWOV HOS NRF BITI AMSF
Adding To Longs: MAIL AOI OMNI
Longs Up On The Day (low vol non-IBD excluded): DIVX-46 PTT-52 SVNT-74 PSPT-32 TTEC-56 CHINA-72 IGLD-41 HRZ-68 CXW-34 DA-53 AOB-76 TRBN-29 MA-104 SOFO-62 FMCN PCCC ACP MAIL MALL RENT AOI CCO IMKTA TSRA RBN CMT DECK ISE HRT ACTU VCLK BMA IAAC SEIC SKX INAP BLUD SQM RJET BMC WTS FTEK BOT IMA LQDT GLDN MCRS MSTR SUAI LWAY LRCX AHS ICE HOTJ CBF EVEP OMNI SIGM ITC ANAD SCI INPC RWT NU PERY MRB ETR PNW AZK ASML SWAT RMR RMKR FBNW
Shorts Up On The Day: HCBK
Stocks On Watchlist: INDM MMG QI MAMA BIOM CMS DRYS ALNY DTSI XIDE SLGN GOAM JRVR
Completely Cut Your Losses/Take All Your Profits: ATCO GSTL OPSW GCOM
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