In my Morning Briefing post published on my JubakAM.com subscription site around noon (and on this site around 8 p.m.) today I said it would be critical to see if the early slight move up in the prices of stocks in technology and other risky sectors held through the end of the day. And I noted that the market had a recent tendency to sell off morning gains in afternoon sessions.
But individual members of the recent most-sold list of momentum stocks managed, in most cases to finish in the green for the day, although lower than their morning highs.
Are you clear on what that means?
Good. ‘Cause I’m not.
It is a good sign–if you’d like the market to resume its upward trajectory–that Alphabet (GOOG) finished up 0.65% for the day or that Amazon (AMZN) closed ahead by 0.67%. But these stocks had been ahead by more–1.2% and 1.07%, respectively–when I checked on them at noon.
My logic for thinking the green on the screen is a positive sign runs like this: Buyers before noon saw these stock as bargains on the dip. Looking at recent trading it would have been all too plausible to feel during afternoon trading “Here we go again.” The easy reaction on the afternoon’s downturn would have been to sell on fear of another late day retreat like the markets saw yesterday.
The fact that enough of this morning’s buyers were scared out of reversing their purchases by the afternoon’s slide strikes me as a sign that sentiment may be moving back to an even keel.
Although I have to say that I wouldn’t build any big trades on logic that tentative.