The trading the day after Thanksgiving is always slow, but it usually has a positive bias. The problem today is that the market negative has been consistently negative for a while and even when there is a relief bounce, like we had on Wednesday, the strength is being used as an opportunity for reduction of long positions rather than a sign that a bottom may be forming.
The action is complicated by some rotational movement. Overall breadth is running negative, with around 3200 gainers to 3600 decliners, and there are over 250 names hitting new 12-month lows. The Nasdaq 100 ETF (QQQ) , and Apple (AAPL) , in particular are lagging. Oil is a major problem too, but the Russell 2000 ETF (IWM) and S&P 500 Biotech ETF (XBI) are trading higher.
There are some signs of strength in the stocks that have been hit the worst, but it is difficult for momentum to build when FAANG names -- Facebook (FB) , Amazon (AMZN) , Apple (AAPL) , Netflix (NFLX) and Alphabet/Google (GOOG) , (GOOGL) -- are still under pressure and the DJIA is at a recent closing lows.
My strategy here is to focus on positioning for next week. There are very few good setups, but the bounces off the lows do give us some support levels to work with. I am not doing any major buying, but the longer those lows hold, the more inclined I am to add things.
The market has very low expectations for any progress on China trade, which means we can see a very positive reaction if something positive does occur. The market has been pricing in ongoing trade chaos for six weeks now -- and at some point it is going to stop causing more selling pressure.