Despite the premarket selling pressure in the S&P 500, the index has recovered to trade close to unchanged, at above 3040. High yield corporate bonds (HYG ETF) are supportive of the stabilization, but they aren't significantly outperforming, and their relatively sideways-to-slightly-higher trading of last four trading days goes on. Technology and healthcare aren't pulling the index up, and that's actually bullish as these two strong sectors can play catch-up later on.

But it's the headline risk, and that can come from China (though they seem content to play the agricultural purchases card for now, and Trump appears unwilling to escalate the situation), or alternatively from the riots gripping the US. On Wednesday, we're getting ADP Non-Farm Payrolls, and I think the runup to its release is likely to offer us lower stock prices than we see currently. So, the potential for short-term move lower is there, and I would prefer to get a better setup from the risk-reward perspective than we're faced with right now.

Thank you.

Monica Kingsley
Stock Trading Strategist
Sunshine Profits: Analysis. Care. Profits.