Spain and Italy didn't want to agree with the EU-pact about growth and jobs until their financial problems were met. When the decision was made to put more money into the banks, futures, the euro, oil, metals... all ripped higher fast. More info on the EU summit here.
So today's session opened with a big gap up. You don't feel like going long there and one would rather short that gap, but that would have only worked for the first 10 minutes.
After a quick morning run, indices consolidated sideways for the rest of the morning & lunch time.
In the afternoon it went up again in a few steps, with a bigger spike in the last half hour. Quite an impressive day, with the Dow +2.2%, S&P +2.5%, Nasdaq +3% and small caps +3%.
Let's see how much we have to give back on Monday. Or will that become a follow-through day?
5m-chart SPY:
Daily charts DIA, SPY, QQQ and IWM:
Euro, oil, metals
Yesterday I mentioned how hard oil, gold and silver can sell off when indices lose 1% or more.
Today the opposite was true, an opening gap of 2-5% was what traders were faced with.
The euro also gained 1.75% at the open and copper went up almost 4%.
Later in the day, especially copper and oil added to those gains. Oil was up 9.5% (!) intraday, copper over 5%. Especially the action in oil was very impressive. This was the first real bounce since the downfall started in the beginning of May.
Have a great weekend!
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