After a bit of selling into the gap down this morning dip buyers showed up and sent SPX back to green by the close. A miracle save from that horrible 9 point downside gap. Breadth was slightly negative. New highs slipped back to 116. New lows picked up slightly to 32.
Overnight the futures dipped all the way below the lower channel line. Then bounced right back during the day.
The green count turned up slightly, but remains below 50.
Will today's recovery embolden bulls to push prices higher from here? Why in the world did I ask that question? I certainly don't know the answer. Tomorrow is option expiration which is often choppy these days. It is possible today's action was about expiration and nothing more. The gap down was not really big enough to cause any panic so the fact the market rallied all day does not really tell us a lot. Maybe I should just start predicting that SPX will be up 1.5 points the next day. Lately I would be pretty close. The slow creep up pattern continues for now. Still watching 2540 on the downside.
While pondering the sentiment situation I got to thinking about this ETrade commercial I have been seeing for a while.
Yacht Life
If the dumbest guy in your high school can make a fortune in the market you can too. I remember seeing similar commercials in late 1999 and early 2000. Making money in the market is easy anybody can do it. Come on in the water is fine. History shows that kind of prevailing thinking is always followed by misery. I do not expect this time will be different. The only question is when. Too bad that is such a difficult question to answer in a bubble. Speaking of bubbles check out bitcoin.
That looks like quite the run up. Keep in mind bitcoin has 0 intrinsic value (even less then a tulip bulb). I have been contemplating that a bitcoin crash might indicate the current bubble mentality that has gripped the world has come to an end. Just a thought. The stampede for the exit should be pretty interesting to watch.
Bob
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