Rally Off the Lows

Dow: +377.37…
Nasdaq: +80.55… S&P: +32.50…

We caught a down open, but the bids came in around 10:30. 10-minute SPX chart below.

The S&P advanced 1.2% today as a short term oversold rally was led by the beaten-up financials sector. The SPX was down as much as 1.9% in early action following a relatively disappointing weekly jobless claims report. 

There is a rumor going around that Wells Fargo is getting bought by Goldman, so there was a short-covering rally in the financial sector. Other than that, there is no big reason for the financials to rally other than that, and oversold conditions. (KRE, XLF).

Goldman is smart and WFC is garbage so we will see what happens. Don’t chase rumors.

The SPX broke its Fib. retracement level so that was a place for buyers to step in.

The market has been buying dips, so a follow-through day to the upside tomorrow will be key for the bulls. A selloff will empower the bears and will take us to more support levels.

Right now the algorithms are running things. The fundamentals are a mess and technicals levels are everything.

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