after the surge of buying earlier in the morning, the major indices spent the better part of the day holding near the highs of the session, but the action deteriorated in the final hour. all in all, however, it was a good day for the bulls. for those that believe in the technicals, volume increased, breadth finished the day at about 3:2 to the positive and biotechs, retailers and chips led to the upside.
that said, the propensity of this market to fade late in the day is quite annoying. this uncertainty gels with the overall lackluster action we’ve seen over the past week or so, but at the same time, the averages continue to hold on pretty well. even if we don’t get another big rally, the longer this continues, the more likely it becomes that investors will start inching back in simply to keep pace. that sort of action can feed upon itself, because as some start to add exposure, the market moves higher, and that will pull yet more money in off the sidelines.
if this market can continue to hold on and we start seeing some better volume, there’s a good chance of that sort of scenario of play out. however, earnings season will likely keep the action choppy.