S&P 500: Yesterday’s Selling Pressure Is Already Running Out of Gas

[Pelican Press 0]

S&P 500: Yesterday’s Selling Pressure Is Already Running Out of Gas

The skidded over 1% Tuesday morning as gas prices and interest rates continued climbing. But rather than trigger a ******* wave of follow-on selling after the index undercut 5,200 support, most owners shrugged and kept holding.

The absence of reflexive selling put a floor under prices, and the market recovered nearly half of those early losses by the close.

If stocks were grossly overbought and vulnerable to a collapse, prices would have tumbled a long time ago. The market rarely gives us this long to sell the top, so the odds are good this is not the top.

While a few hours of constructive trade Tuesday afternoon was great to see, by itself, that doesn’t ***** the selloff. That makes Wednesday’s early trade critical. If we survive that, the bears are in trouble.

Unless Wednesday morning turns into a dramatic waterfall selloff, this is simply another buyable dip on our way higher. That’s the way I’m trading it. I bought a partial long position Tuesday afternoon with a stop under the early lows.

If the rebound continues on Wednesday afternoon, I add more and lift my initial stops up to my entry points. If the selloff resumes, I get out of my partial position at my stops for a small loss, no big deal.

To be honest, part of me hopes this selloff continues even though I’m holding a partial position. The lower this goes now, the ******* the profit opportunity the market will be giving us.

Unfortunately, I don’t think I will be that lucky, and most likely, Tuesday’s selloff won’t amount to much. That’s why I’m already buying.

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#Yesterdays #Selling #Pressure #Running #Gas

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