The Empire Strikes Back
Just Monday I stated the oversold market would see a Turnaround Tuesday reversal. Candidly speaking, I didn’t think it would be this significant. Nevertheless, the power of the empire can be strong especially when its bonus time at the end of the quarter, just two days away.
Right, I’m a cynic these days.
One thing was clear this day bulls regarded BREXIT as no big deal. After all, since it won’t have an immediate negative effect on the economy. Remember markets are short-term oriented these days. Yeah, right, I’m cynical again.
Everything that was down yesterday soared higher this day. As media struggle to find an answer to why markets rallied Tuesday the WSJ noted that “US Homeowners Would Gain by Brexif”. That’s a desperate reach.
Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red). Dependent on the day (green) may mean leveraged inverse or leveraged short (red).
Volume was high once again but not so much as the previous 2 days. Breadth per the WSJ was positive.
The NYMO (McLellan Oscillator) and NYSI (McLellan Summation Indicators) have not been are late and haven’t been posted yet.
Let’s see what happens.
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This looks like a "fool's rally" to me. There was no basis for the financials to rally like they did today. Most of the daily and technical indicators are giving clear sell signals, although the fast stochastics show that a little bit more upside is possible tomorrow. Since fundamentals no longer matter in this matter, the technicals are all I can go by for the time being. Of course, a lot of big rallies start as oversold and short covering rallies, so nothing would surprise me at this point.