Bullish reversal as Growth starts to make a comeback

Short-term trends for US Equities remain negative but Wednesday’s reversal did have the makings of being important from a trading standpoint, and occurred on capitulatory levels of early breadth which can sometimes prove significant.  Despite the negative momentum and ongoing negative breadth, I think a case can be made for a bounce into FOMC which then would likely prove to be resistance and line up with short-term cycles that call for a possible mid-month peak.  Furthermore, back-month seasonality for September is traditionally quite poor, so the quality of any bounce will need to be analyzed closely.  For now, there are some signs of Small-caps having carved out meaningful reversal patterns which could lead to a bounce, and growth seems to be on the comeback after three straight days of outperformance by QQQ vs. SPY.

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