“Just when I thought I was out, they pulled me back in.” - Michael Corleone

As I mentioned in yesterday's article, the market is schizophrenic - up 100 points one day down, 100 points the next.  Today was no exception.  The Dow Industrials was up almost 170 points, S&P 500 just shy of 20 points, and the NASDAQ up over 30 points. Does this mean the bottom is in? As much as I'd love to say yes, the logical (and pessimistic) part of me says not quite yet. There are some concerns, like lack of volume and no strong participation from the semis to mention a few, but back to the positives. There were more buy candidates on my screening that I've seen in a few weeks, so I'm starting to feel a little better.  Let's just get some follow-through on the upside.

I'm going to start probing a little on the upside with some smaller positions. The reason I'm not putting on full positions now is there wasn't a strong theme to the buys that my screens put out today. I'd like to see several buy candidates come from a few sub-industry groups.

Panera Bread (PNRA) has been in an uptrend since August.  This is contrary to the market's movement, which tells me there is some buying going on. There were two very nice up-days the beginning of last week and a slight pullback last Thursday and Friday. If we take out the highs from today $58.48, that may be the sign that buyers are coming back.

Panera Bread

I hate to be redundant but this market has not convinced me that a bottom is in. I don't predict; I react to what the market is telling me.

Please use stops with all your trades, especially in this environment.

Tom Incorvia is a swing trader with 18 years of experience in the financial markets.  E-mail him at tincorvia@gmail.com.