SHORT-TERM STOCK REBOUND NOT THAT IMPRESSIVE

NOT MUCH OF REBOUND...This time last week it seemed clear that stocks had put in a short-term bottom marking the start of a potential bear market rally.   So far at least, that rally hasn't gone very far.   The three charts shown below show the same overhead resistance lines that have yet to be tested.   The daily bars in Chart 1 show the Dow Industrials ending the week on the defensive after retracing 50% of their March to May downtrend.   That's a normal spot to expect some selling to re-surface.   The Dow also remains below its 50-day average.

Chart 2 shows the S&P 500 meeting resistance at its 38% Fibonacci retracement line.  In addition, the SPX is meeting resistance near its March bottom.  That's not unusual since broken support levels usually act as overhead resistance.  The SPX has also fallen short of testing its 50-day average.   The same is true of the Nasdaq which has led the market decline.

Chart 3 shows the Invesco QQQ Trust which tracks the Nasdaq 100 meeting resistance at its 38% retracement line and broken support along its March.   In addition, the chart shows volume remaining light during the rally attempt.   That's a pretty weak rebound.   The QQQ also failed to reach its 50-day average.