Mind The Gap, Volatility Building

Lately we see more and more big gaps at the opening of the session. Volatility is rising, which indirectly implies a higher VIX, a sign that traders are getting anxious. This could be the prelude of a correction, or lots of sideways shopping around for the next week. I don't believe we'll start rallying this week, not until things like the shutdown and fiscal cliff clear up soon.

At the start of the session, indices started rallying higher after the overnight gap down. The last 40 minutes however, came with another sell-off. On the daily charts, we see sideways action for most major indices, and even a trend lower for the Dow.

5m-chart SPY:

Daily charts DIA, SPY, QQQ and IWM:

Euro, oil, metals

The euro is bouncing of 1.355, trying to get back to 1.36.

Oil went down rather much overnight, but bounced great. Still down over 0.5%, but a (red) hammer giving hope to the bulls. Metals were mixed with copper under breakeven, gold gaining nearly 1% and silver up well over 2.5%.