FLASH COMMENTS:

Well, here we go again. 

The S&P 500 has begun another tactical oversold bounce after holding the 3900ish technical support level.  The U.S. Dollar also appears to have stalled after reaching an overbought condition, and lots of forecasters and talking heads are talking about excessive levels of pessimism, which has energized the bulls who were a bit beaten up since Jackson Hole. 

On the way down from the recent August 16th peak, the worst performing sectors were Tech, Comm Serv, Consumer Discretionary, and Materials with Energy, Utilities, and Staples the best.  Want to guess what the leaders/laggards have been since the market bottom last week?  Leaders have been Consumer Discretionary, Materials, and Comm Serv among the top five while the laggards have been Energy, Staples, and Utilities in the bottom five.  So, a near-perfect mirror image.  Indeed, the most shorted basket of names as calculated by Bloomberg has surged nearly 12% since Tuesday’s close. 

New bull market or short squeeze?  Based on my work that has been unfavorable since April, the answer remains quite clear — countertrend short squeeze rally

After speaking with many clients last week and continuing to have heated interna...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

Disclosures (show)

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You’ve reached your limit of 2 free monthly articles. Please enter your email to unlock 1 more articles.

Already have an account? Sign In

Want to receive Regular Market Updates to your Inbox?

I am your default error :)