In impressive style, stocks bounced back from early losses to post solid gains on higher trade. The day started off slowly for the market but caught a bid around lunch time and never looked back all the way to the close. All five major indices closed higher on the session. The small-cap Russell 2000 led the advance as it climbed by almost 2.0%. The Dow Jones Industrial Average added 1.4% while the S&P MidCap 400 and the S&P 500 tacked on 1.2% and 1.1% respectively. Despite the poor earnings news for AMZN, the Nasdaq still closed higher by 0.5%.

Market internals were bullish across the board. Turnover spiked by 19.6% on the Nasdaq and 9.2% on the NYSE. ended mixed for a third straight day. Advancing volume overshadowed declining volume by a factor of 4.3 to 1 on the NYSE and 1.8 to 1 on the Nasdaq. The positive price action combined with the uptick in volume points directly to institutional buying. Consequently, we would categorize yesterday as an accumulation day on both exchanges.

The First Trust Consumer Discretionary AlphaDEX ETF (FXD) has been hovering for the past three days at its 200-day MA as it attempts to hold this key mark. Yesterday, FXD undercut this moving average and reversed to close near session highs. A volume-fueled move above the two-day high of $20.77 could provide a buying opportunity in this ETF.



Yesterday, on light volume, the iPath Goldman Sachs Crude Oil ETN (OIL) sold off and now appears headed for a pullback to support of the 20 and 50-day moving averages. An undercut of these key marks could provide a buying opportunity in OIL.



Our position in SLV acted well yesterday as it consolidated just above Tuesday's high. SLV is now forming a bullish pennant formation on the hourly chart and appears ready to make a move higher. With yesterday's rally we now have another bullish confirmation suggesting that the market is ready to move higher. All we need to see now is a breakout of leadership stocks to new highs.

Deron Wagner is the Founder and Head Trader of both Morpheus Capital LP, a U.S. hedge fund, and MorpheusTrading.com, a trader education firm.