By Nicholas Santiago on July 7th, 2010 3:27pm Eastern Time
Everything in the market is catching a bid today. Over the past few days the major stock market indexes were extremely oversold and it seemed as if the markets would never have another positive session. Today the major indexes are higher by about 2.00 percent across the board. Many major commodity names are all surging higher. Stocks such as Cliff Natural Resources Inc (NYSE:CLF), United States Steel Corp (NYSE:X), and Southern Copper Corp (NYSE:SCCO) are all trading sharply higher. When commodity stocks and technology stocks trade higher it is usually the making of a good rally and today that is the case.
The one problem with today's move higher is simply the poor action in Exxon Mobil Corp (NYSE:XOM). While the stock is positive on the session it is certainly lagging the other major names in the energy sector. If the markets are going to see any significant rally last a few days or longer it will need Exxon Mobil Corp to participate. This stock has the largest market capitalization in the stock market and that alone will carry a lot of weight. When Exxon Mobil moves higher most traders will pay attention.
So far today's action cannot be denied. It is important to remember that many amateur traders went short at the lows and will need to cover their positions. Therefore, today's move can get a little overdone to the upside do to those traders buying back their out of the money short positions. As we say when you can read the charts then you can make the money. Today is just one day and really nothing more. The month of July should have a lot of short term whips and surprises in store.
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