The indices closed the day around flat but it was no victory for the bulls as they squandered a strong open and trended lower all day. They couldn’t even manage to keep breadth positive and finished with about 2,500 gainers to 3,100 decliners. Gold and silver were the big winners once again and mining stocks even managed to outperform the metals a bit.
We certainly have lots of gloom and negativity, so it won’t take much for an oversold bounce/short squeeze to kick in. In fact, bearish action like we are seeing right now is a great setup for a bear market rally.