So far, today’s session followed the “opening gap weakness, intervention bullish strength rally later” pattern.
The trigger-break above 2,110 caused bulls to become more aggressive as sellers triggered stop-losses again.
We’ll update our key simple levels and note trending stocks today:
The breakout above 2,100 resulted in a short-squeeze where bears (short-sellers) unwillingly helped propel the market higher as they covered their losses with stops triggered above 2,100.
Yesterday’s session closed at the high, though this morning saw a retracement back to the 2,112 pivot level.
I wanted to highlight the simple retracement patterns that continue to be effective for short-term traders to pinpoint entries into this short-squeezed rally.
Let’s see what our Breadth Chart reveals about current market strength (or weakness):
Today’s session gives a muted bullish signal in our Breadth Chart.
All sectors are near the 50% Breadth Level, except Consumer Discretionary (the strongest) and Utilities (weakest).
We have potential bullish trend continuation plays in the following stocks from our scan:
Verisk (VRSK), Nike (NKE), Markwest Energy (MWE), and Newfield Exploration (NFX)
Potential downtrending candidates exist in stocks showing relative weakness today:
Lumber Liquidators (LL), Hewlett-Packard (HPQ), Green Plains (GPRE), and YY
Corey Rosenbloom, CMT
Afraid to Trade.com
Follow Corey on Twitter: http://twitter.com/afraidtotrade