Thursday, May 31, 2012

Nice Intraday Bounce, But A Weak Close...

After a big gap up and a big gap down earlier this week, today the market opened flat. But within half an hour, indices lost more than 0.5% and another hour later, the loss grew to 1% for Dow + S&P and up to 1.5% for small caps. Tech and small caps were today's laggards.

For the first time in days, buyers came in with volume, pushing the price back towards opening levels (or even higher for the Dow-index). Then the market started to consolidate sideways.

And it only got better in the last 45 minutes. The high of the early afternoon broke and prices went up fast in no time, trying to get all indices back in the green. The bears however stepped in during the last 20 (very volatile) minutes, deciding all went up too much too fast. So we did close red and rather weak... The first minutes after hours saw only more downside. Tomorrow we need to see some follow-through on the upside after today's bounce.

5m-chart SPY:

Daily charts DIA, SPY, QQQ and IWM:

Euro, oil, metals
Oil just can't catch a break. Commodities in general are sold off worse than stocks for some weeks now. Oil was down 2% to 86 before it bounced with the market. But it still ended down over 1.3%.
In exactly one month, oil has lost 20% (and down 6% in 2 days)! In comparison, the S&P500-index is down 'only' 8%.

The euro isn't doing much better, trading under the 1.24-level and making new lows, just like oil.

Metals are trying to hold up and were trading slightly in the red, gold almost at breakeven.

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