Markets put on a good face Monday and there was a healthy amount of skepticism throughout social media as it was very hard to find someone bullish over the weekend. Of course there is still an enormous amount of damage to be worked off for the benchmarks and today was a good start. We know we do see some of the most violent rallies in bear market tendencies and we are not near there quite yet but it certainly felt like a lay up to short the super strong open, and any who did saw the powerful opening gains cut in half. But the late morning bounce continued and proved for real. Looking at the 10 year yield its chart is one of beauty, and many use this as an excuse of why markets will have headwinds because of it. It is bull flagging and has last Thursday found support at its rising 50 day SMA after a recent cup base above a 2.47 level. A break above a 2.95 flag pivot carries a measured move to 3.45%.

Looking at individual sectors it was just what the bulls would have scripted if they could have Monday. It was technology and financials that led with the XLK and XLF rising 3.8 and 3.2% respectively. “Lagging” were energy, staples, and the utilities all gaining by 1.8, 1.4 and 1%. It was indeed a broad, healthy rally as all nine of the major S&P sectors advanced. Of course the enthusiasm has to be contained as the ETFs basically recovered just last Fridays losses as the XLK slumped 2.7 and the XLF by 3% to end last week. Like the XLF which last week recorded almost an identical double bottom, separated by a penny on 2/9 and 3/23, the XLV did nearly the same with just 5 pennies the difference on the same dates. The round 80 number is holding up for the moment and needs to as the figure is the horizontal line in a bearish flag formation. A pierce and CLOSE below would carry a measured move lower by 12 handles.

The airline plays have been through a lot of negative media recently, with pets and altercations, but we focus purely on price action. Some obviously have acted better than other and it pays to keep an eye on which names are acting well and poorly. Below is the chart of SAVE and how it appeared in our Friday 3/23 Game Plan. As peers AAL and DAL are off just 12 and 9% from most recent 52 week highs, SAVE has floundered as it sits currently 37% off its own highs. Adding insult to injury it acted very poorly today on a very strong tape as it fell by 4.4% and is now on its first 4 session losing streak since last October. Since December ’16 it has traded between the round 30 and 60 numbers and should it test the low end of the range in the near term there is a good probability it may not hold.

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