The indices continue to hold up extremely well and are hitting new intraday highs. This tendency toward improvement during the day after a weak start is what is keeping the bears on the sidelines. Until we have some notable weakness in the afternoon it is difficult to be very negative.
I've seen a significant number of studies that show that a retest of the December lows is very likely to occur. This one from KL Capital is particularly interesting. After a 15% waterfall decline we typically have a counter-trend bounce of around 11-12% that lasts an average of 21 days.
There are a plenty of other interesting statistics in this study but, be warned, they do not paint a very positive picture. There are very high odds of a retest of the lows and when that happens there usually is a recession to go along with the poor action.
I don't rush to act on statistical data of this sort but it does make me less inclined to pursue new long positions when I see so few with good technical setups. This market is obviously overbought and hitting resistance but there seems to be no real concern about a pullback, let alone a retest of the lows.
My goal as a trader isn't to call market turns but to navigate the meat of the move. My view right now is that we are close to the end of this bounce. That believe is primarily driven by the fact that I see so few stocks that I want to buy right now.
What the bears are missing right now is that the negative narrative has been shoved aside and there is more concern about making up recent losses rather than worry about being trapped in another pullback.
I'd like to be far more upbeat but I'm frustrated that I'm not seeing more things to buy. New Age Beverages (NBEV) and Nio (NIO) are a couple that I've traded recently that are popping up but I'm not willing to put much new capital on the line right now.