Last Thursday we noted that the market was oversold everywhere, and historically when those extremes are reached, the market typically bounces a bit. As shown in our updated "Dow 30 Trading Range Screen" below, most stocks have indeed seen a nice bounce off of oversold levels over the last week. In the screen, the dot represents where the stock is currently trading, while the tail end represents where it was one week ago. As you can see, most dots are to the right of the tails, meaning the stocks have moved higher within their trading ranges.
A lot of stocks remain oversold, though, just much less oversold than they were last week. Names like American Express (AXP), General Electric (GE), Coca-Cola (KO), 3M (MMM), Merck (MRK), Travelers (TRV), Wal-Mart (WMT) and Exxon Mobil (XOM) were all in the dark green zone last week, meaning they were more than two standard deviations below their 50-day moving averages. Now they have moved up into the light green zone, which is between one and two standard deviations below the 50-day. It's nice that these stocks have stabilized a bit, and if you're bullish, they're still trading at levels where they have a long way to go before getting overheated again.
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