It was another volatile day of action with a good recovery late in the day as oil reversed sharply. There was lots of talk about what is going on in Libya, but the simple fact is that plenty of stocks with solid fundamentals have come down far enough to attract a little buying interest. Market players are still reflexively inclined to buy dips, and they did that this afternoon.
The big picture remains murky. We still have not put together a very good oversold bounce, which is what we need to gain a better feel for what sort of correction we are going to undergo. Already the bulls are less aggressive than they normally have been because of the uncertainty in the Middle East, but there are some signs that they are champing at the bit to light things up.
We have a couple strong reports after the close from momentum favorites DECK and CRM, which should help sentiment but the news risk out of the Middle East remains very high. The market hates uncertainty, and we are likely to have some for as long as oil supplies remain problematic.