Stocks rebound after 3 days of losses
The action for the last 3 days has been nothing but bearish. SPX lost its 1700 levels and ended up at the 21 day support. NDX and RUT also followed but the damage was limited. The Fed talk and the easing of QE bond buying may have traders worried. The loose talk came from several Fed Governors and the markets tumbled. However the oversold action today resulted in a decent bounce.
This is our earnings seasons and coming to end soon. Most of the earnings have come in line. We still have few more names to go. The earnings have kept the markets floating to the upside lately. This will be over in next few weeks and we may settle on some new worries. As long as the QE punchbowl is in the party markets will be flying higher, even though the economy is making lackluster progress. With merely 172,000 jobs added its the slowest recovery seen in decades. Other economic data is also improving but hardly a matter where there is a V shaped recovery in place.
TSLA and PCLN had their earnings yesterday and today. Both stocks went up in after hours trading and now have a huge gap to contend with. PCLN was trading at 983 up 50 points from todays close as of this writing. It may gap up and may see 1000 to be the first stock to do so.
Market action is still bullish but trendless and we may chop around here up and down for sometime.