With a little more than an hour to go in the day, it looked like the buyers would give us a decent close, but we fizzled quickly and ended back near the lows of the day by the closing bell.
It was an all around ugly day. Volume was heavy, breadth was terrible, with just 370 stocks up on the day, and the buyers incapable of holding on to even a minor bounce.
The dip-buyers who did so well when this market was trending up couldn't be enticed by this substantial pullback. Rather than feast on the bargains, they are cowering in the corner.
The market is wrestling with the same problem that crops up in a correction: uncertainty. Nothing else gets market players selling so aggressively. The big questions are the euro bailout and the financial regulations working through Congress. Until we get clarity on how these issues will play out, market players will prefer to sit on the sidelines.
If you have taken some defensive action and have built up your cash, this market action isn't such a terrible thing. It will offer some great opportunities. We have to be patient and get the timing right. Protect that capital and you'll be in good shape to rack up some gains as the dust settles again.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment