Markets rallied for a second straight session Wednesday with energy, industrials and materials leading the way. I would be hard pressed to call this move rotation, but rather just an oversold, dead cat bounce, which can still have legs. That has helped the S&P 500 outperform the Nasdaq for a fourth consecutive day. The S&P 500 rallied .7% and the Nasdaq rose by .4%. The S&P 500 went out on highs for the second day in a row and one can make the case that a bullish inverse head and shoulders pattern is taking shape with the 2 clavicles a bit V shaped which would make the formation failure prone. They normally flourish near bottoms too, but sentiment is so low and it the people I converse with remain steadfast that the “correction” awaits. Tech has been underperforming a bit thanks to some poorly received earnings releases. Most notably today was TWTR which plummeted today falling 14% and this was following its previous report on 4/29 which slumped 18.2%. The stock looks headed to at least the round 30 number which was supportive dating back to the entire month of April last year. Two other names that lost ground in groups that have been solid for the most part this year were AKAM and DATA of the IT and software sectors. Both CLOSED very powerfully after finding almost precise support at their respective 200 day SMAs. DATA perhaps be forgiven for todays action, as it roared ahead its 3 prior times after reporting numbers by 13.6, 17.2 and 10.2% on 5/8, 2/5 and 11/6. Below is how we profiled AKAM in last Mondays Game Plan and a good example of why we insist on CLOSING prices. There never was one above the 73.90 pivot point.

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