The Gilmo Report

May 29, 2019

May 29, 2019

The sloppy market action continued right into the new trading week as an early gap-up open yesterday reversed into an ugly sell-off in the final two hours of trade. The Dow closed below its 200-dma for the second time in May. This all led to a gap-down open this morning, but the S&P 500 and the NASDAQ Composite Indexes eventually found and held support at their 200-dmas.



I would emphasize that I characterize today’s action as support at the 200-dmas, but not necessarily supporting action at the 200-dmas. We’ll see how this plays out in the coming days.

Every group in this market has been beaten-down as of late, and if one is looking for long ideas, it is now mostly a market of individual stocks. With most leading and formerly-leading names coming off some distance from their highs of a month ago, one also has to be selective in choosing short-sale targets. Names that are deeply extended on the downside are susceptible to sharp reflex rallies at this stage of the game.

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