What You Need To Know About A ‘V’ Move

A follow-through day occurs when the market rises 1.5 – 2% on a pick-up in
volume after an attempted low. But, one should not just buy with abandon. A move
like this tells you the trend has turned up near-term. Of course, all this could
change but odds favor upside testing.

The Nasdaq/Nasdaq 100 connection continue to
lead. As I have stated, they never even came close to their October lows while
every other major index did. Please keep in mind that most of the
TECH names are coming off low and mid-level
bases so lots of resistance to get through. The same goes for the rest of the
market.

There have been many follow-throughs in the past 3 years. All have failed in
this brutal bear market. All new bull markets have started off with
follow-through days but not all follow-through days have led to new bull
markets.

You can start to scale in but keep your rules. This market is emotional…this
market is news-driven. ..this market could be knocked around like a punching bag
based on all the fluid news. I would concentrate on leading stocks breaking out
of their trading ranges.

BUT…keep your feet on the ground. This move is already reminding me of the
July and October lows wherein the Dow ran up
1200 points in days. These “v” moves have all failed in the past. Maybe this
time is different. I am hoping the market starts to pull back in here. That
would be a lot more healthy than a straight-up shot…which normally fails. Many
are calling this move a new bull market and many are saying it is a fake-out. I
am in neither camp. I believe it is more important to let the daily market
action be your guide. The world is littered with so-called geniuses that have
been woefully wrong during this bear market. We have nailed things for you in
this commentary just by interpreting the action.

If this is for real, don’t sweat it if you have missed the first few days. If
this is real, leadership will show up on a daily basis that can be exploited to
the upside.