This definition of levitation is from Wikipedia:
"Levitation (from Latin levitas "lightness")[1] is the process by which an object is suspended by a physical force against gravity, in a stable position without solid physical contact. A number of different techniques have been developed to levitate matter, including the aerodynamic, magnetic, acoustic, electromagnetic, electrostatic, gas film, and optical levitation methods."
When markets gap up on the open, they remind me of something which is levitating...they seem to be suspended/elevated by combined forces which have exerted energy through momentum. As you can see on the Daily charts below of the four Major Indices, after today's (Monday's) opening gap up, they are all still under the influence of negative momentum, albeit two days' worth of decelerating negative momentum.
As shown on the 2-day comparison chart below, the Nasdaq 100 leads in terms of percentage-gained on the two-day bounce, followed by the Russell 2000, the S&P 500, and then the Dow 30 Index. This suggests that the current market appetite favours the riskier sectors over their blue-chip counterparts. Whether buying continues to push and hold momentum above the zero level remains to be seen. It would appear that the high-beta stocks within the NDX and RUT are the ones to watch over the near-term. Buying momentum within all four Major Indices can continue to be monitored by viewing the Momentum indicator, as well as the percentage-gained on a daily basis. Any weakening of these may be a signal that this recent bounce may have run its course, particularly as the Indices approach the underside of their major trendline breaks (which I've written about in recent posts).
