Markets shook off some soft early morning losses Wednesday, with the leading Nasdaq recouping almost all of Tuesdays decline. Volume today however paled in comparison to the heavy trade that accompanied Tuesdays drop. It outperformed the S&P 500 by a double today, and a look on the Nasdaq’s weekly chart shows some hope for optimism. The weekly closes the last 2 weeks have been extremely tight, separated by just two handles. This week is staying right in that taut neighborhood, and tight trading must be construed as bullish. Energy was in focus again today, as many names demonstrated some nice reversals. The incessant chatter in the media with the slump in crude prices has created an opportunity in our opinion for a bounce, perhaps just a dead cat, but these names have fallen sharply and look ready for a rebound. The action in oil today ahead of a war strategy was concerning, but to me more alarming was how we are going to outline our plan. Not sure what happened to the surprise element, but thats for another discussion. Oils woes could be blamed on a number of things, with perhaps the abundance of the resource domestically, or more likely the relentless greenback rally is the cause. That move should simmer down, and that should provide some tailwinds for many names in the sector to move their way higher. Some retail names are starting to strut their stuff. LE, a recent SHLD spinoff, had a wonderful session up better than 20% after releasing earnings. Is the weaker crude price already filtering down to some firms numbers?
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