Confirmation Counts
As I write this, the futures are
going gangbusters to the upside. The DOW is up
242, the S&P up 24 and the Nasdaq up a whopping 35. If the market holds
today’s early rally, it would be the first
confirming follow-through day off the
lows. It would happen on the fourth day of the rally that started last
Thursday. This would also confirm most of my
script that I laid out for you over
a month ago. It included a double bottom…it included happening in October. The
one chink in the armor is that the panic selloff is missing. Yes,
the market had a huge selloff, but it was more controlled than panicky.
That does not matter to me any more.
Confirmation counts.
If the market does confirm today, be much, much, much less
short, if not out of all shorts.
If the market confirms today, start making a list of
stocks that have sound bases and either breaking out or about to.
Please do not let emotion get in the way. Always…and I
mean always…let the market be your guide.
A few other things to keep in mind:
Every new up-leg has started with a follow-through day,
but not every follow-through day has led to a new up-leg. Just because the
market follows through does not
mean it is the start of something grand. There have been many follow throughs
over the past 30 months.
Bear market rallies are sharp, quick, don’t let you get in
quick enough, make you feel good, suck you in, and bury you soon after. Just
look what happened between 7/24
and 7/29 of this year. This rally is sharp…this rally is quick…and
with today’s gap on the opening, does not let you in quick enough.
If this is for real:
breakouts will start working…
pullbacks will be controlled…
more and more names will come up their right sides.
Will report back to you tomorrow. Should be an interesting
day.