A poor finish took some of the luster off a pretty good intraday reversal by the bulls. This morning it looked like a stronger U.S. dollar was going to put the sellers in the driver's seat but the euro came back to life, despite worries about Greek sovereign debt and that brought in the buyers. The euro faded again and the dollar strengthened in the final hour of trading and that was all that was needed to turn us back down.
Breadth was very unimpressive at almost 2-to-1 negative and the leadership in gold was puzzling given that the dollar was positive. Retailers and banks were particularly weak, which is not a good combination.
If we take a step back and look at the bigger picture, what we have is a market that has attempted to bounce back after breaking down to start the week. We had a pretty good rebound Wednesday and Thursday, but it is running out of steam and market players are a little nervous that we may finally see a failed bounce rather than another of those V-shaped recoveries.
The bulls have gotten very used to this market quickly and easily bouncing back after a brief struggle and they are hopeful that will happen again.