The Ultimate “Reopen” Trade
Everyone can’t take their eyes off the stock market right now…
But the biggest development we’ve seen over the past several months is the breakout in energy names and crude.
Yes, oil is back above $45, gaining nearly 4% yesterday and hitting levels we haven’t seen since early March. It certainly has my attention…
Watch my latest TV appearance below, where I talk commodities, stocks, and what I think about this week’s tech dip:
Keep it In the Money,
Chart of the Day: Is the Nasdaq headed lower?
Early Wednesday morning, I mentioned how the major averages were stretched and the herd was getting a little complacent following the strong push to new all-time highs.
The market will need to digest these gains one of two ways, I noted, either by chopping along or pulling back. My guess that we would see some form of a pullback before the end of the month started to come true almost immediately. A quick drop materialized that afternoon as momentum traders began taking profits on the high-flying tech stocks.
Is this the beginning of a more substantial correction? Or just a little speed bump on the way to more melt-up gains?
Yesterday’s action indicates the latter – at least for now. Tech stocks jumped back to attention following Wednesday’s quick selloff as traders bought back shares, pushing the Nasdaq back into the green after gapping lower to start the session.
But if we do see stocks continue to retreat, led lower by tech, I suspect the Nasdaq Composite will find support somewhere near 12,000.
Either way, there are only three weeks left in 2020. Whether we see a deeper pullback now probably won’t put a damper on a low-volume holiday rally heading into the New Year.
— Greg Guenthner