Today’s action shows that the stock market might want to pullback after a strong rally. This is because, the stream of good news has failed to push stock above the resistance level. This means that any small bad news will trigger a sell off.
The sentiment is still bearish, thus any bearish stocks would be good trade for this pull back.
The VIX is at a low level, signaling complacency. Traders might buy fear at this level.
The only way the market can continue higher is to show unemployment claims below 450k and analysts are doubting that.
So, purchasing Direxion bears like SOXS might be a good idea, though a high risk play.
The SOXS is at a support level, it may bounce from here to maybe around $36.
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