Price traded in a similar pattern to what we saw yesterday, starting strong but weakening throughout the day.
What’s going on now and what levels are important? Let’s see:
Compare yesterday’s early morning gap bounce with today’s gap rally into resistance.
Both sessions price traded into resistance above 2,080 and then gave back the gains in a retracement phase back to the 2,070 pivot.
That’s where we are now and we’re balancing the odds of playing bullishly for another rally up away from the 2,070 level or a breakdown with bearish opportunities potentially triggering under 2,070.
For now, the level just above 2,070 and then 2,085 will be today’s support and resistance reference levels.
Let’s see what our Breadth Chart reveals about current market strength (or weakness):
Breadth today is bearish except for two stand-out sectors.
Energy and Utilities are seeing strong positive breadth readings today while all other sectors hover near the 30% line.
It’s a conflicting picture with bearish signals as again price falls lower from resistance.
Here are today’s strongest trending (intraday) names – candidates for pro-trend continuation:
Interactive Brokers (IBKR), BP, Medicines Co (MDCO), and Vertex (VRTX) (be careful with these names)
Bearish downtrending candidates include the following stocks from our “weakness” scan:
Centene (CNC), Dupont Denemours (DD), YELP, and United Natural Foods (UNFI)
Follow along with members of the Afraid to Trade Premium Membership for real-time updates and additional trade planning.
Corey Rosenbloom, CMT
Afraid to Trade.com
Follow Corey on Twitter: http://twitter.com/afraidtotrade