What a turnaround day!

What an impressive day today for the markets!! I did expect S&P would try to rally but did not expect what happened after opening that it dropped like a stone for a while. However, finally it managed to come back quite strongly. Dow Jones has even managed to make the strongest intraday reversal in the past 4 years with a 300 points swing during the day. But just keep in mind, this is likely a short-lived dead cat bounce. It may still try to go up a bit, barring any significant negative news from Greece. Regardless, I don’t expect S&P could overcome its resistance around 2100.

As I said, Wal Mart (WMT) appears to have bottomed around $70. Today’s WMT price action is a classic text-book demonstration what a bottomed stock should do. As you can see below in the intraday price chart, WMT (blue) decreased much less than S&P (red) when the market was declining and jumped much higher than S&P when the market was heading high. This provides more convincing evidence that WMT has indeed bottomed for now. WMT is one of few blue chips that one can consider to buy during a severe market correction. But be aware that WMT is hitting its resistance around $74 and if you want to buy, you may get a better chance in a few days.