We’ve entered that phase in the market bounce, where everyone is wondering whether this is a “Dead-Cat Bounce” or not.
My experience with market bounces following a huge sell-off, is that they usually last 3-4 days, enough to where people feel comfortable with the notion that the worst is behind them, only then to have the rug gets pulled out from underneath them.
We are in day-two of the dead cat bounce, and I wouldn’t be surprised to see the market rally through the remainder of the week, and wipe out the week’s losses. Just enough to put a ‘feel-good’ story out there for investors to go into the weekend with.
Should the market decide to make this a temporary bounce, I have put together a list of stocks to watch as potential short plays. We are also in the heart of earnings season, so make sure to be aware of any potential hazards there.
Here’s my dead-cat bounce, list of stocks to watch as short setups: