markets can keep going down if they are fairly valued, just like they kept going up c1999 when they were egregiously overvalued.
funny how Minutes from August 7th, time at which the Fed still believed it would not need to act, affect the market. When the Fed did react 10 days later (lowering the discount rate by 50bps). Lots of datas have been computed by the Fed since August 7th... thus the action on August 17th... thus the action on Sept 18th Oil getting lower (lesser inflation rsik) , indicators pointing to slower economy growth, Not much is holding the Fed from cutting the fed fund rate by 25bps on September 18th. bottom line... the market will come back... and quickly from today s drop
The minutes really, really scared the market. ES got scared all the way to 1435. Bull be back WED imho.
Bears shouldn't read too much into today's sell off. The dow is still 600 points above the lows and the Bullish Dragonfly Doji Pattern is well intact.
There is noting like a sarcastic tone to help start a mini fight. Well, basically, after a sell off like today there should be buyers lurking WED to scoop some shares. Will it bounce up 275 points and bring us to # from Friday? I doubt that, but a moderate 50 point rise should occur. There is money on the sidelines that I am sure of. I think ES at 1437 as room to go up. The market wend down too quickly and it was based on notes from the first week of August that really pushed the market into a free fall. I think this drop will make Mr. B to at least speak and in words try to help the market pick itself up. I stated that the Bulls should come back WED. Beyond that is anybody's guess.
Surprise , surprise. It wasn't a sell off. It was program trading hitting the DOW, SPX at 3.25 PM Eastern. Under 25 minutes SPX dropped 15 points. Just look at Intraday charts. It was a steep drop with no letting up, straight down and it leveled out, and tried to go up and the bell rang. The timing of it is highly suspect, all these great things in the market have been happening lately right around 3.30 PM or so. Its always some kind of a hard close right around here at this time. the VIX pops up and the SPX puts balloon and wide bids and ask rule. All too familiar a game that just keeps reapting itself, since they wiped an uptick rule for shorting stocks. I usually wait to see what the last half hour brings, and than initiate my positions , to give a surprise to the surprise givers.
Market is fine, it will blossom after labor day weekend. Money managers are angling in fish ponds of Montana and Idaho. Some are upside down snorkeling in Cayman Islands and some are beating bongos in the Caribbean . When these people come back market will assume a different shape. Wait till mid September for things to shape up and bring in full set of traders. Right now you are at the mercy of hardcore Hedge fundies and trading jockeys swinging wildly without care or caution. They will scare the jesus out of the Feds and anybody in their paths. Some days its 300 points up some days its 400 down. You feel utterly helpless. There is something you can do with these buckaroos that come out around 3.30 PM Eastern. There are about 22 Big name firms indulging in progam trading, and about 40% volume on NYSE is program trading. Always wait till 3.45 PM to initiate positions, so you can see the true color of these buckaroos. With your orders sitting in thier paths, there is a surprise given to these guys.
That sell of at the end was scary. I guess by then everybody and their grandma were shorting the market. And then right before the market closed a blue line on the volume appeared with over 100K on the ES. Somebody was buying that is for sure. WED will show if this was the start of a new trend or a dead cat bounce.