How Much Can The Market Bounce 市场能反弹多少

After trending down in the last 14 days, the US stock market staged a big surge upward today. Dow, S&P 500 and Nasdaq Composite closed up 2093 (+11.26%), +209.93 (+9.38%) and +557.18 (+8.12%) respectively.  These are the biggest single day percentages in 80 years. The biggest point gains in history. History is made and we witnessed it.

                                                                source finviz.com

Why the big rally today? It's all about stars lining up. First, after a 34% drop in the S&P 500 from all time high in the past month, yesterday the S&P 500 touched a support level near 2200 which is derive from August 2016. Second, the market is extremely oversold with CCI at under -300. Third, the congress is about to finish negotiating a $2 trillions coronavirus economic stimulus package.  Fourth, massive short covering also help to push the market up. People believe that this package together with Federal Reserve's indefinite easing should relief some stress to the economy.

However this one day big surge is still just a bounce in a bear market. The general market trend is still down. The coronavirus development still controls market direction. Situation is still dire as increasing number of states in the United States are ordering people to stay home with no schedule of ending. About 140 million people are affected and economic actives have stopped. It will be devastating to the economy. Confirmed virus infection cases are just starting to explode in the United states as more and more people are tested. Big confirmed number of cases such as 50,000, 100,000, 150,000....are going to be bad headlines for the market in the next 2 weeks. Things are going to get tougher and tougher and fear will follow. This is why market trading strategy is still sell on rallies.

Since the stimulus package has not been passed yet, and this is good for tomorrow as it is still serving as a bait in buying. So tomorrow before the stimulus package is announced, the market will still go up. But be careful after the announcement because sell on news may happen. Technically, the S&P 500 may run up to the 38% Fibonacci bounce level at 2550 level. For a stronger 50% bounce, it would be the 2660 level. These two levels would be triggers for the market to turn back down.

在过去14天的跌势之后，今天美国股市出现了大幅上涨。道琼斯指数，标准普尔500指数和纳斯达克综合指数分别上涨2093（+11.26％），+ 209.93（+ 9.38％）和+557.18（+ 8.12％）。这是80年来最大的单日涨幅百分比。历史上最大的单日下跌点数。历史创造了，我们见证了历史。

                                                                源自Finviz.com

为什么今天会大升呢？都是因为吉星排列所致。首先，标普500在过去一个月从历史高点下跌了34％之后，昨天标普500触及了来自2016年8月的2200附近的支撑位。第二，市场的超卖情况非常严重，CCI低于-300 。第三，国会即将完成一项价值2万亿美元的冠状病毒经济刺激计划的谈判。第四，大量的空头回补也有助于推动市场上涨。人们认为，这个刺激计划以及美联储的无限期宽松政策应能缓解经济压力。

然而，今天的大幅上涨仍只是熊市中的反弹。总体市场趋势仍是下降。冠状病毒的发展仍然是主宰美股的关键。随着美国各州越来越多下达命令人们无期限地待在家里，形势日趋严峻。约有1.4亿人受到影响，经济活动停止，这对经济将是毁灭性的。随着越来越多的人受到检测，确诊的病毒感染病例在美国才开始爆发。确诊病例的大数量，例如50,000、100,000、150,000 ....在接下来的两周内将成为市场的头条坏新闻。事情将变得越来越艰难而恐慌会随之而来，所以市场交易策略仍然逢高卖出。

由于刺激方案尚未通过，这对明天有好处，因为它仍是买盘的诱饵。因此，明天在刺激方案宣布之前，市场仍将上涨。但是在宣布之后要小心，因为可能会发生事后的获利抛售。从技术上讲，标准普尔500指数可能会升到38％斐波纳契反弹水平2550。如果反弹幅强劲的或可到达50％反弹水平2660。这两个水平或将触发市场回落。