And we're back! (for now)
Keep in mind, of course that 2,710 is only the WEAK bounce line on the S&P and we need to clear AND HOLD all the bounce lines before the market is back in a truly bullish mode. While the 5% Rule™ protects us from jumping in and chasing false bottoms – after such a huge fall it's frustrating to sit on the sidelines while stocks recover.
Our predicted bounce lines are:
After yesterday's strong rally, we're already back above all our -10% lines except the Russell, which actually fell from 1,750 to 1,450, which was 20% so bounces from a 300-point drop are 60 points so 1,510 (where we are now) is weak and 1,570 is strong so really, on the Russell, that 1,575 line – is the more important number to clear which means, logically, if you are going to back a bullish horse, /RTY may be the way to go.
Meanwhile, before we go reaching for the stars, we should at least see if the S&P can get over it's weak bounce line at 2,710 and the NYSE 12,150 (they are bopth around there this morning) and whether they turn black or red this morning will likely determine the direction of the market. As noted in the title, however, it's the last day of the month and all the stops will be pulled out by the powers that be (the Banksters, not the Government) to engineer a not-so-terrible finish to the month.
As I noted yesterday, China, Europe and the US have all taken measures to boost the markets so of course we're hitting our weak bounce lines and the strong bounce lines won't be surprising but will we hold those? Sadly, that's a question we'll have to answer in November but, for today, expect more of the same from yesterday and a HUGE disappointment if we don't.