The bulls had two good arguments to start the day. A capitulatory low on Wednesday and a friendly central banker in the form of Mario Draghi.
A couple of months ago, we would probably be flying on these types of catalysts but market players have learned a painful lesson lately when it comes to chasing early strength. They have been slammed, which is why they were a bit reticent this morning.
The tepid open was probably a better setup for some follow through, and now we are seeing a little better buying as we take out the opening highs. Breadth is about even, and we only have about 150 new lows, which is a huge shift from the 2,700 or so we had yesterday.
Conditions look good at this point for some continuation of the bounce and I'm participating with a position in the ProShares Ultra S&P500 (SSO).
One of the most annoying things about the market at this juncture is that you simply won't find many individual chart setups. We have lots of oversold bounces and other bottom fish plays, but there aren't breakouts from consolidation or similar patterns at this juncture.
However, my Stock of the Week, Pacific Biosciences (PACB), is one stock chart that does look pretty good at this point. It has held well in the recent chaos and is pushing back toward the key $13 level.
I'm definitely not convinced that the corrective action has come to an end, but hopefully we can have at least a brief respite. If you have a high level of trust in this market, you haven't been paying much attention lately.