The markets made a decisive move higher today, with all three majors closing up +2.5% on average. We went into this past U.S. holiday weekend with a pretty bearish pattern in the markets. We didn’t get the follow through to confirm another bear move, though, as the market action was to the upside since today's open.
A move like this is hard to digest without more data, especially coming out of a long weekend. Is this a bear rally...or something more? Usually, the volume and volatility can help, but we saw very little out of both. The VIX did drop, but only slightly, as the volume in the S&P was average at best. The only thing that we know for sure is that the markets have retraced a little more than half of last week’s losses.
Over the next couple of days, we should be able to identify short-term support and resistance levels if the volatility continues to stay at these levels. Keep an eye on the volume this week – specifically, if one market direction exceeds the other in size.
Have a great night,
Maverick Trading
Over the years, we have spent thousands of hours talking with our traders and answering their emails. We have a huge collection of really great information that only benefited the specific traders who we were interacting with. So, we decided to start sharing all of these gems of knowledge with everyone.
