My market thesis right now is that we are likely to see trading range action as the bears that are focused on the narrative of a slowing economy do battle with the bulls that are focused on possible good news on China trade and a dovish Fed.
The trending action that dominated for the last several months has many thinking that another trend will emerge, but I expect a good battle before that happens.
Early strength was sold Monday morning but there are some signs of support.
It doesn't feel like it based on the stocks that I watch, but breadth is running about four-to-three positive. The FAANG names are mostly up but the speculative cannabis stocks are mostly down.
The Fear of Missing Out (FOMO) isn't in play Monday and as a result there is much more mixed action. From a technical standpoint that is a positive as it helps charts develop a better foundation for another leg up.
While I am not doing any major buying I am looking at some stocks that are turning up off support such as Uxin Ltd. (UXIN) , which operates a used car e-commerce site in China.
Pyxus International (PYX) , which was my Stock of the Week, last week, is pulling back in front of its earnings report Monday night. I'll be looking for another trade there Tuesday after the news is announced.
Overall the market action is mixed with a slightly negative bias, but I like the potential for better stock-picking as charts develop.