Finally, a rebound effort did not fail as we’ve seen so many times in the recent past. While yesterday’s rally lost some steam during mid-day, the bulls did not give up and the major indexes closed at their high points for the day as the chart (courtesy of MarketWatch.com) shows.
With no news out of Europe to rock the boat, the focus remained on domestic issues. Energy stocks provided the ammunition for the rally along with auto sales, which came in better than consensus estimate. Pending home sales rose as buyers tried to take advantage of the $8,000 homebuyer tax credits before the April 31st deadline.
Our domestic Trend Tracking Index (TTI) bounced off its trend line after coming within +0.49% of breaking it to the downside. The move into bear market territory therefore has been postponed as the index has now moved +1.45% above it.
We will have to wait and see if this rebound has legs or will turn out to be another head fake, which is likely to happen if Europe events move back onto the front page news menu.