for those that believe, it seems the market has been stuck between important technical levels and hovering below overhead resistance, unable to make up its mind. today’s session was a perfect example of all of the different factors at play.
anyone who needs to eat or drive to work knows that prices are going up across the board, but today’s CPI data said different. the tame inflation data allowed a market that was tentative early on to rally strongly in the morning and into the afternoon, but investors moved swiftly and aggressively to lock in gains and/or short just as the averages hit so-called technical resistance levels.
the late-day reversal seen today definitively reinforces the feelings of some that this market will undergo another bout of selling. many are calling for (in some cases) extreme caution.