Another postive reversal, but negative results
by
, 02-10-2016 at 01:26 AM (1454 Views)
Stocks opened lower on Tuesday but in an attempt to play Turnaround Tuesday, the Dow reversed a 146-point early loss into modest gains in afternoon trading, before dipping into the close and ending the day down just 13-points. Continued global growth concerns and another sell-off in oil kept the downside pressure on stocks.
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So, a slight loss in the Dow and S&P 500 showed some relative strength compared to a 4.7% sell-off in oil.
Also, Greece's market was down another nearly 3% yesterday.
Janet Yellen gives a congressional testimony today and that could be a market mover intraday. She is usually a decent shot in the arm to the market but she will have to dodge a lot of bullets from a concerned congressional panel.
The SPY (S&P 500 Index / C-Fund) was basically flat after trading up and down on the day, but remaining above January's low for another day.
The Dow Completion Index (small caps / S-Fund) did test the January low again, and held again. The bulls will not want to see it hang in this area very long because if you keep knocking on the door (support line) eventually someone will let you in.
The Dow Transportation Index again outperformed yesterday gaining 1% on the day, but it remains in the bearish looking flag formation. It is back above the 20-day EMA and approaching the descending bear market testing, 50-day EMA
The EFA (EAFE Index / I-fund) closed well above its intraday lows and above the January lows, but still lost over 1% and ended the day at it's lowest closing price of the year.
Greece's Index lost another 2.89% yesterday as the slide continues.
The dollar resumed its decline moving down to nearly fill the gap opened back in October. That helped cushion the I-fund some.
The price of oil is also testing the January lows so it looks like we will either get another leg down here, and in many stock indices, or we'll get a double bottom. It's possible that we could get a "swoosh!" push lower and positive reversal, just to take out some trader's stops before rallying.
The AGG (Bonds / F-fund) shot higher early but backed off perhaps from some bond traders taking profits, but also because stocks closed well off the lows.
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Thanks for reading. We'll see you back here tomorrow.
Tom Crowley
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