A detente in the U.S.-China trade war has brought relief to Wall Street.
The most beaten-down Dow stocks including Apple, Caterpillar and 3M rebounded Tuesday, shaking off their worst losses from a downbeat month.
Newton Advisors' Mark Newton says one of those names is showing early signs of a bottom.
"Caterpillar, in particular, does look to have hit a level that has been important over the last six to eight months, and that's right near $116 to $118. You've seen some mild stabilization," Newton said on CNBC's "Trading Nation" on Tuesday. "But one to two days of rally does not really make a new trend."
Caterpillar broke down below May lows this week but has bounced back close to $120. It would need to fall more than 2% to reach the lower end of Newton's support range at $116.
"Apple, on the other token, has been a clear leader," said Newton. "Technology, that's still an area that I think is going to do a little bit better than industrials… Apple is the one I think you'd want to favor."
While those two stocks are worth a look here, Newton warns that the day-to-day volatility tied to the trade war is not yet in the rearview mirror.
"I don't think we've seen real capitulation just yet," said Newton. "We certainly haven't seen the signs that the market likely has bottomed because of fear. It has been a lot of uncertainty and pessimism, but I don't think we're quite there just yet."
Quint Tatro, president of Joule Financial, sees any more pullbacks as opportunity.
"What we've seen is that when things get very dark and the pessimism goes up considerably, that's when you have your opportunity," he said Tuesday. "I wouldn't chase today's rally but these stocks that are moving are buys when they dip, and I think you've got to be very careful getting too pessimistic too quickly."
Until a trade deal works out, Tatro says keep calm and stick to your strategy when markets come under pressure.
"It's just a matter of time before another headline comes out and we see declines and it gets very scary," he said. "I'm not saying to try to time the market per se, but follow your plan … revisit your allocation, and possibly if you've got some cash on the sidelines that's when you deploy."
