|Day Low/High||9.82 / 10.43|
|52 Wk Low/High||2.46 / 12.42|
There are some signs of an intraday reversal in the S&P 500 SPY that I'm monitoring.
It is logical that stocks consolidate a little as we head into earnings season.
This is a very healthy market and some consolidations and pullbacks would be advantageous for trading.
There are a couple of things that are helping to contain the selling.
This isn't a market with a lot of very extended stocks so the chances of catching some names at support are good.
Don't be in a rush. The key to accumulating stocks in this environment is to move incrementally.
There is plenty of chasing of the strength which is an indication that FOMO is in overdrive again.
Here are several names I'm looking to build on further weakness.
Biotechnology is always high risk but the right plays move unlike anything else.
Precious metals continue to soar and China names are under pressure.
Even if you are convinced that disaster lies ahead what choice is there but to try to make some money while you can?
I expect those that have been missing out to be lurking not too far under the surface.
Traders are moving quickly to find some individual stocks that are acting well.
Is this just 'one day and done' selling or the start of a deeper pullback?
It isn't just the bears that would welcome a pullback in this market.
Bears have been confounded by the positive sentiment, but economic realities are not going to suddenly disappear.
Despite the lackluster action there are some pockets of good stock picking again.
My main focus right now is on stronger defense.
Anyone attempting to navigate this market based on macro-economic analysis is going to have a tough time.
A major theme of late has been the outperformance by post-pandemic names in groups such as biotech.
The biotech sector doesn't look anything like a bear market.
I believe this is just bounce action at this point and not a bottom, but I'm playing it.
The action is not supportive of good chart setups for shorter term trades in individual stocks.
There is nothing in small-caps to suggest that they are as frothy as the big-caps.
Stemline Therapeutics, Entercom Communications and Ocular Therapeutix offer reasons to think their shares will perform better in the New Year.
I am inclined to focus more on counter-trend bounces in weak markets.
Flat markets tend to produce favorable technical setups, but this one may put us to sleep while we wait for further developments.