The Dow Jones Industrials Average and the S&P 500 are still in negative territory and breadth is solidly negative but we have a sizable bounce off the early lows with the Nasdaq and Nasdaq 100 in the green. The FAANG names are leading the way but there are also some sizable bounces in small-cap names that were brutalized on Friday.
The dip on Friday stirred up some very strong emotions and there were plenty of doom-and-gloom scenarios being discussed over the weekend. It is understandable that many market players may think it will be different this time. The quick-and-easy bounce has become far too routine and smacks of manipulation but we are seeing signs of it again this morning.
Ironically, once the dip buying starts it becomes self-reinforcing. The fear of missing out kicks in very fast and quickly puts a bid under the action. The realization that this time it isn't different and quick dip buying still works ,causes even greater desire to buy quickly.
I restarted a position in Alibaba (BABA) this morning as it comes off its 50-day and have cut a little Twitter (TWTR) that I added on Friday. Twitter is one of my bigger positions right now and I continue to like it into its earnings later this week.