Daily chart for S&P
Daily chart for NASDAQ
The bounce did come and it was stronger then i expected. Usually market bounces after a downtrend tend to be fast and furious. Some bounces would gain momentum and continue to become the start of a rally. This has not happened as volume had been decreasing everyday since the bounce began last week.
With the start of earnings season today, i would expect some upside momentum in the next few days. However we are still below the 50 and 200 day moving average and for Dow and S&P, the 50 day moving average had crossed the 200 day moving average. This is a very bearish signal for the market. And I believe the same would happen for NASDAQ over the next 2-3 days. So do not jump into any long positions unless the individual stock is a very beaten down one. One example would be BP.
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