MONDAY'S MARKET WRAP-UP
Good day fellow traders!!! The market continued its roller coaster ride in Monday's session with another swing to the upper end of the 60-minute trading channel. The trigger came in the form of the 15-minute Momentum Reversal pattern I wrote about in my weekend column and buying began within 15 minutes of the opening bell. The intraday bias was once again strongly in favor of the shorter-term daytraders as well and the strong uptrend provided ample opportunity for short-term gains.
Dow Jones Industrial Average
The Nasdaq led the session's upside, fueled by strength in technology. Microsoft (MSFT) landed a licensing deal with the military contractor General Dynamics (GD), placing it in a rare leadership position for the day. It was the strongest intraday move the stock has had year-to-date. Amazon.com (AMZN) also made waves after Morgan Stanley (MS) issued a bullish report for the company and added it to its "Best Ideas" list with strong overseas growth potential.
After triggering, the Momentum Reversal on Monday morning kept the bulls on solid ground throughout the session. A typical target for this reversal strategy is the zone of previous highs and all three of the major indices accomplished this feat by mid-afternoon. The final push into this target zone came right out of the 14:00 ET correction period with a burst of buying. Once that previous level of resistance hit, however, the momentum slowed and the indices ended the session just off intraday highs. The 20-day moving averages continued to also provide additional daily resistance at these highs.