Market Alert - The Close

Two days down, two days back up, but still significantly below the pre-Brexit vote levels. The large cap indices made it through the next level of resistance, a necessary step to recovery, but as is often the case, the rebound, while quite solid with 1.7% to 2.2% gains Wednesday, is still not as strong as the selloff.

SP500 34.68, 1.70%
NASDAQ 87.38, 1.86%
DJ30 284.96, 1.64%
SP400 1.78%
RUTX 2.19%
SOX 2.05%

VOLUME: NYSE -5%, NASDAQ +5%. Flattish volume as stocks continue to rise. Not a surge of buying but still strong enough volume to push the upside.

A/D: NYSE 6:1, NASDAQ 3.7:1. Still very strong upside breadth indicating across market buying.

Some individual names are performing well. SBUX gapped and rallied through the six week lateral bottom to the April to May selloff. AVGO gapped over the 50 day MA's on strong trade.

Most stocks moved higher with these other stocks but the moves were not as strong. Oil stocks were up but not surging. Metals, industrials, financial were up but not with the same strength and they also have to deal with next resistance. That is, of course, always the situation when there is a sharp selloff; digging out of a hole is always harder.

Nonetheless, stocks were hard at it Wednesday, trying to get out of the hole, posting that second day of recovery. The upside rebound continues and now looks to Thursday to try and keep it going.

We picked up some WWW and MBLY upside, also letting existing upside work higher as long as it will. Many stocks have rebounded but are not in great upside patterns, more like bear flags. They provide downside possibilities if they stall and the market stalls the recovery move. Nothing as of the Wednesday close, however, shows a stall, just that many stock patterns in the market have to improve to keep the move going.

Have a great evening!

Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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