Scavengers in the Early Weakness

After a fairly sizable thrust lower to follow-up Friday's steep selloff, the Nasdaq is now green I as write this while the rest of the tape fights back. This initial dip-buy attempt should give us some good insight as to what type of market beast we are dealing with, in terms of the sustainability of the reversal--A completely giveback of the bounce followed by a close deep in the red would not be a particularly good sign for bulls, for example. 

That said, we used the early weakness inside Market Chess Subscription Services to close out a few levered index bearish ETFs on the Dow and the Russell. Our focus now is on whether relative outperforming stocks, like GOOS (updated below) can now thrive if the broad market gets this bounce rolling into the afternoon. 

GOOS has earnings later this week. But it is just one example of the type of relative strength we seek to identify during market pullbacks. Note how the emerging retail winner basically gave back none of its impressive gains even as the indices were whacked. 

There are a few other charts like this we are keeping tabs on. But it is worth noting that how we close today likely carries far more significance than a spirited, early-morning bounce.