Sea Of Red Changes Trading Pace
The market continues its crazy dance and this week’s tune sounds familiar.
Monday the market ripped higher and bulls took the bears’ lunch until this morning when the day began with a sharply lower opening.
The bear’s revenge didn’t stop until the markets were a sea of red.
The Dow closed at 25,890.18 points to fall 1.51% (dropping 396 points on the day). The Nasdaq fell to 10,343.89 points for a .86% tumble while the S&P 500 dipped 1.08% to 3,145.32 points.
Tuesday ended a multi-day winning streak in the markets. Traders weren’t shy about taking gains with rally momentum that appeared overbought.
The exciting part of this market is tracking where the Dow will go after five straight days of gains and then the bleed off. Questions remain whether the Nasdaq will knuckle up to ignore negative news again to scale up to another all-time high. The S&P 500 doesn’t appear to want to take sides as it bounces up and down in the market fray.
Heavy market movement like today is when aggressive traders fight the rough surf to catch a strong wave while cautious traders wait for calmer waters.
Last week the Simpler Trading call was to take opportunities in the strong bullish uptick while carefully considering what would happen early this week.
Tuesday’s pullback reset the pace for the rest of the week heading into earnings reports that kick in next week. The earnings run then continues through the first of August.
While today’s session was rough, the Nasdaq shows strength fueled by the technology sector. This bullish strength shows opportunity for a push higher through earnings.
Indicators favor moves to the upside, but it’s unclear how much or how long the overbought concerns will affect trading marketwide.
We Saw: markets diving into a red zone —
- Investors selling off big name stocks for gains
- Entertainment, travel sectors facing more issues
- Covid-19 resurgence scare widening faster
We’re Watching: strength of market to push higher —
- Consolidation in indexes showing explosive possibilities
- How long overbought pullback will last
- Moves in: TDOC, NFLX, PZZA, TSLA
Does it make sense to “see” price moves before they happen? Learn about catching “pops and drops” in a volatile market.