Why the S&P's intraday bounce matters: Technician

Why this S&P bounce matters: Technician
Why this S&P bounce matters: Technician   

The S&P 500 staged a midday rebound on Tuesday, saving the index from its fourth straight day of losses. And that bounce could be the start of a prolonged move higher for stocks, according to BTIG technician Katie Stockton.

"Today is certainly encouraging," Stockton said Tuesday on CNBC's "Futures Now." "You can't call one day a reversal, but to the extent that we could see the S&P futures hold support at 2,075, that's a good thing, that's a positive. Usually the oversold bounce takes a few days to develop."

Indeed, Stockton believes that the market has become "oversold."

"If you look at where [the S&P futures] are trading today, there is some short-term support that's being tested. So this would be a natural place for additional buyers to come into the market," Stockton said.

With markets already turning around, stocks should see "an oversold bounce in the days ahead," the technician predicted.

On the other hand, if the S&P does continue to lose ground, it could eventually present an attractive opportunity for the bulls.

"Typically in a strong upturn corrections tend to be fast and furious, but allow us a nice buying opportunity for the long run," Stockton observed.

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