NEW YORK (TheStreet) -- The indexes had a gap-up open on Monday and finished near the highs of the day. This did not come without anxiety this afternoon as the Nasdaq and Russell 2000 indexes slipped into red territory at 3:00 p.m. EDT.
The DJIA closed up 146.49 points at 16173.24 and the S&P 500 closed up 14.92 at 1830.61. The Nasdaq gained 22.96 to 4022.49 after being lower and the Russell 2000 gained 3.92 to 1115.35 after being in the red as well this afternoon.
What this means is all the inde-es had an oversold bounce within a Trend Bearish formation. Again, Trend Bearish is a three month or longer time frame. The levels are developed according to an internal algorithm process.
As I wrote Friday, I was looking for the a relief rally that would begin early this week. The fact that it happened on a gap-up open came as no surprise. The algorithm-programmed machines are in control of this market. They have the internal numbers that say when the indexes are oversold and when they should be bought.
Once again, however, the volume on this relief rally on Monday was much less than desirable. The S&P 500 ETF (SPY) volume was approximately 44 million shares lower than last Friday. In other words, this was a classic dead cat bounce with less volume than the 50-day moving average. As I have been consistently writing about, the green up day volume is much lower than the red down day volume. It matters in the bigger picture.