When panic takes over market and people start to lose their nerves, invariably the situation resolves to the upside in the short run. That is the nature of market and that is why most traders find it extremely difficult to trade such market. Bounce happen when everyone is shit scared to buy even a dollar worth of equity. Bargain hunters and veteran traders thrive on such situation.
Going by the emails and comments, one can make out how the emotions played during the day.I was fast asplep during the entire drama and was reading the report early morning. I suspect the intra day 65 day ratio reached extreme levels of 1600/200 yesterday by mid day. Many people were convinced there will be no bounce.
Those who kept their nerves caught the turn. This kind of game is for extremely nimble players. If you are asking what to buy now, you should just stand aside and watch the fun. You should have kept the buy list ready in anticipation much in advance. Such bounce in first phase invariably have the most oversold falling knives bouncing back.Heavily shorted stuff with extremely negative sentiment will bounce back 10% plus in a matter of hours in such bounce.
Such bounce have certain common characters: panic, series of bad news, bears dancing on the street, perma bears on first page of popular sites claiming what you have seen is just trailer and there is more downside ahead, break of some technical level like 200 day MA, high volume selling, and capitulation by many players. Traps in market are always at levels where majority will get trapped.
Expecting the bounce to play itself out for couple of days.