Tuesday, October 23, 2012

Short-term Bottom Seems Closeby

The market gave us a very big gap down at the start of the session. Indices losing more than one percent was a very uncommon picture the last couple of months. But today we opened about 1% lower. After some more morning weakness, indices tried to fight their way back towards the opening levels. Still down a lot, but giving bulls some hope that this could be a short-term bottom. However, the close wasn't that great.

With small caps-index Russell2000 printing a hammer, there is hope for upside tomorrow. But that doesn't mean we'll see new highs for the year in the next few weeks. More downside or sideways action is more likely imho.

5m-chart SPY:

Daily charts DIA, SPY, QQQ and IWM:

Euro, oil, metals
Indices had a very rough day, and the story was no different for the euro, metals and oil.
The biggest losers were silver and oil, both down well over 2%. Copper and gold lost between 1.3% and 1.4% while the euro went 0.6% lower.

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