Pause Day Or Something More?
Normally, after a large rally or decline the next trading session is much more subdued or quiet. Yesterday, the stock markets surged sharply higher with the Dow Jones Industrial Average gaining over 300.00 points by the end of the day. The rally was broad based as most every leading stock sector participated. The only negatives for yesterday's stock market advance were the light volume and the closed bond market. Every trader should know that light volume favors the upside and the when the bond market is closed that will also favor a stronger stock market. Other than these two negatives the rally was solid.
This morning, the markets seem to be much quieter at this time. The leading stocks such as Apple Inc (NASDAQ:AAPL), Amazon.com Inc (NASDAQ:AMZN), Exxon Mobil Corp (NYSE:XOM) are all trading higher to start the day. The weak stocks this morning are the financial giants such as J.P. Morgan Chase & Co (NYSE:JPM), and Goldman Sachs Group Inc (NYSE:GS).
Traders should simply expect a somewhat flat trading day. If the financial stocks can catch a bid there is a chance of a move to the positive side. Right now, this market is setting up for a typical pause day which is very common after a large rally. .