With Thursday’s breakout, many charts around the world broke out. If it is a bear market rally, it’s a very convincing one. I saw a nice list from Charles Schwab that shows how many of these super surge days there have been and if they were in a bull or bear market.
From Charles Schwab:
The move was dramatic, squeezing short sellers in a big way which is also why the thrust up was extraordinary. I went back to look at the chart for the ones that occurred in 2008 and 2009. Interestingly, there were some that looked bigger, than March 9 or March 23, like the November low. I find it interesting that the March 2009 rallies were not in a bear market? Maybe with hindsight, you can say that was the start of the bull market? Anyway, the table makes a nice list of days to reference.
For me, it was a great rally as we change from bear to bull. The Dow was already above the 200 DMA, but the Nasdaq was not.
I got whipsawed Thursday as I started to see gains evaporating into Wednesday and sold my portfolio as the market struggled. Missed a nice upside day, but there is always another train at the station. I guess that is the price of playing defence in a bear market.
I like the price action I’m seeing here and I’ll have a complete review for members on the weekend. If you are interested in why this week marked a major change in the markets, you can try a $7 subscription for a month and see if the PLUMB system works for you.
For more informative ideas check out OspreyStrategic.org. There is also a video about how we approach the market on this page. Osprey Strategic Approach.
Good trading,
Greg Schnell, CMT, MFTA