Stock futures rise after previous day sell-off

The stock market situation is bearish after the sell-off which started at the end of the previous week. However, the bearish pressure seems receding today and the stock futures mostly trading upward. Despite the situation, traders will stay cautious as the current bullish movement might be a temporary upward movement before further downside.

No change to the strategy, traders will wait until the bearish pressure recede and add more long positions at a lower level.

Technical Analysis

Dow Jones Industrial Average (INDU)

DJIA index dropped with strong bearish momentum after the recent event which signaled a hard landing for the economy. The index soon will test the 38,000 handle as we mentioned before. If the index continues lower and prints a new lower low then it will extend the bearish movement toward the 36,000 handle.

Bank of America (BAC)

BAC share prices’ bearish movement has reached the daily SMA 200 and there is a bullish bounce. The bounce reaction might be a temporary reaction before further downside in the share prices. Traders will monitor the share price movement near the daily SMA 200. If the share prices could stabilize and trade sideways near it then there is a chance of a bullish bounce.