The bulls finally made an appearance today following five straight days of selling. All three majors made decent moves to the upside, with the S&P posting the largest gain of just under 1.25%. We would expect a counter move after five straight days in either direction...now we just need to see how far this move will go.
We are once again seeing different levels in the three majors. The Nasdaq is still the strongest of the three, pulling back to its rising 20-day simple moving average (SMA) and posting a nice hammer candle. The S&P has given up more, moving below its 50-day SMA, but bouncing off of its rising 200-day SMA – still an overall bullish sign. The INDU looks to be struggling here – below its 200-day SMA and setting a lower low.
Earnings season is still the main driver to these markets. We should now look to the sectors with the strongest results. It is still early, but today's move could create opportunities to the upside...or at least trigger some bullish setups. Feel free to start adding to your portfolio if desired. Make sure to implement both longer- and shorter-term trades, thus making it easier to adjust your exposure based on any changes in market sentiment.
Have a great night,
The Maverick Trading Team
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