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Stock futures rebound

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Stock futures are getting a bit of a rebound this morning as S&P futures are up 8 points, NASDAQ futures are up 27 points (1.86%) and Dow futures are higher by 67 points. Fair value for the S&P 500 today is $2.68. HL Camp & Company has their computers set for program buying at $3.94 and set for program selling at $1.32. Fair value for the NASDAQ-100 today is $5.34.

Bond YIELDS rise

This morning we're also seeing some selling in bonds as YIELDs rise on the 5-year ($FVX.X) to 4.498%, the 10-year YIELD ($TNX.X) is breaking to a 4 session high of 4.92% and the 30-year YIELD ($TYX.X) is up fractionally to 5.459%.

This morning's action should have bearish traders snugging down some stops for the bulk of their trades where they've got some nice profits. It's been my view that a trade that is profitable by more than 7% to the downside should not become a losing trade. A trade that is profitable by more that 15% should result in a gain for the trader at some point if his/her stop is moved down to profitable.

Bullish % data

Yesterday's action had the NASDAQ-100 Bullish Percent ($BPNDX) reach the 23% level and violate recent lows found in June and July for this shorter-term indicator. A reading below 30% is considered oversold and bearish traders should be tightening down stops for their bearish trades. Any bullish trades entered at this point should be with the premise of looking for a short-term trader's rally.

The S&P 500 Bullish Percent ($BPSPX) has not seen enough internal damage to get this indicator into "bear confirmed" status. While this indicator still should have traders playing defense, the "bull correction" status and 47.27% of the stocks still showing a buy signal on their point and figure charts gives hint that there still was not enough internal damage done to get this market into "bear confirmed."

The broader market bullish percent data still shows the New York Composite in "bear confirmed" status, but holding its ground at 33.2%. On Monday, the bullish percent reading was 33.11%.

Jeff Bailey
Senior Market Technician

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