After witnessing some steady selling for nearly two weeks long, we finally got some broad buying today off "weak" volume.    Well, it's weak volume according to many market analysts because the average declining volume during the last few days is much higher than today's volume.    However, today's volume is above average if you take into account the three months average.    In another word, volume isn't bad out there.   What most people are concerned, at this point, is whether this is nothing but a temporary bounce which may leads to further decline sooner or later.  A positive is strength was not sold as in any uptick last week and finally Oil/ Gold gave overall upward direction.   We need some follow through, today we had no bad headline news flow and a few positive catalysts in Volker rules possibly not passing, ISM and the budget details were not as feared for foreign corporate profits.

It's true, after some relentless selling during the last few days, any bounce is not trustworthy.    Since many of us have accepted the notion that this market can drop another 5% or more, today's action seems like just an inconvenient step stone to the inevitable outcome.   Or is it?     Over the past few months, we have witnessed market's move that is anything but rational.    Even though the possibility of market going much lower is pretty high, it doesn't mean that it will..     How do we play this then?   Right now, many plays on our listed plays are due for a bounce and this is the way we are calling it.    Whether this moves translates into something else few days down the road, then,  we'll give it a new assessment.   For now, we are treating today's action as simply an oversold  ‘short covering’ bounce with the hedgies stopping end of month selling as discussed late last week.     If some plays happen to establish some strong support at the recent low after a few days, then we'll likely enter a more meaningful position for a trade.      As far as this bounce goes, if trading, sticking with ETFs and some sector beta stocks for as long as majority of stocks below 9ema.  Friday, we alerted the ‘Casino’ Macau space and today LVS WYNN  were the big beta winners.

Remember, if we are treating this move as nothing but a short term bounce, we ought to stick our trading strategy as fast trade only.   If this somehow establishes a support for SPX and the market sentiment picks up, we'll likely add back some longer term position.     In any case, there's no rush to go big into some smaller plays on first sign of positive action.