Outside of the fact that the market didn’t see any following through to the downside today, there just wasn’t anything to get excited about. Yes, the financials regained a little less than half of the ground they lost yesterday, but investors sure weren’t in any rush to try and pick up the pieces in other areas of the market. In fact, the continued rebound in treasuries, and the breakout move in gold only reinforces the notion that investors had their confidence badly shaken yesterday.
From a technical perspective, there’s still room for the bulls to step back up to the plate. The S&P 500 is right at lateral support levels, and the Nasdaq is only a snudge below its 50 dma (and still above the lows from the 30th). Unfortunately, they’ll have to pull themselves up by their bootstraps at this point. Like we said earlier, if they can do so without the crutch of hope for some magical formula from Washington, we might then have a better chance for a more sustainable counter-trend rally.
Take opportunities where you can find them; I still think the November lows were the lows.