Weak Bounce Does Not A Bottom Make; Near-Term, Bears Still Hold The Advantage

Published 06/16/2022, 12:22 AM
Updated 07/09/2023, 06:31 AM
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On Wednesday, buyers stepped up to the plate and recovered some of Tuesday's losses, but buying volume yesterday was down on Tuesday's for some indices—and there were some losses end-of-day to keep the gains in check. I wouldn't expect much from indices today. But slow, steady gains over coming days would be good.

COMPQ Daily Chart

The S&P 500 did manage to register an accumulation day but technicals are net bearish.  If there is going to be a 'bear trap' it will need to do a lot more.  Bears hold the advantage in the near term.

SPX Daily Chart

The Russell 2000 (via IWM) finished with a 'spinning top', which is a more neutral outlook for the index.  With the undercut of the May lows in the S&P and NASDAQ, the likelihood for the same happening here is increased. Yesterday's close also saw a loss in relative performance to the aforementioned indices.

IWM Daily Chart

We can't say a whole lot about Wednesday's action. The candlesticks were neutral and volume was on the light side.  This has the look of a weak bounce. To reverse this we have to see an increase in buying volume and ideally, wide range candlesticks.  Lets see what Thursday brings. 

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