Friends
After breaking through a major support level on the S&P 500 early this morning, stocks plummeted over 150 Dow points only to recover late in the day to end the day up 29 points. You need motion sickness pills to stomach the wild gyrations we are seeing these days. The afternoon rally was interrupted briefly when President Obama was seen on television gathering with his cabinet members (can we get him to take a vacation also?). Other than that, it seemed like we were due for a bounce having been down 8 days in a row on the Dow Jones Industrial Average and 7 days in a row on the S&P 500.
The ADP employment report and the ISM non-manufacturing number helped in setting a negative tone this morning, but the oversold condition in stocks helped provide at least one day of relief from the carnage seen over the past two weeks. Traders will be squarely focused on the jobs number coming up this Friday. Expectations are extremely low at this point, so there is a chance that the bad news is already discounted in stock prices.
Oil continues to fall, closing at just above $92 per barrel, which could provide a tail wind in an environment of multiple headwinds. Gold continued its march higher closing at $1661 per ounce. It seems like the only thing that could stop gold from continuing to rise would be me, personally, taking a large position in the yellow metal. That would surely stop the rise and make gold plummet.
On a serious note, the negativity on the airwaves and amongst market “experts” is as high as I have seen in quite some time. At least a contrarian can take heart in that.
Have a nice evening everyone.
