All the major indices closed today near their lows of the day for the first time since August. There was a little buy program in the last five minutes to prevent any selling momentum into the finish, but it was the worst intraday action we have seen in a while.
The bulls will be quick to point out that the selling took place on abysmal volume. Mondays are typically slow and the bond market was closed for the Columbus Day holiday. The S&P 500 ETF (SPY) had its lightest volume of the year by far and that was the case with many other key indices as well.
Unfortunately, the combination of very slow and slightly negative action doesn't produce any major shift in market character. The indices are still extended and no technical damage was done today. If anything, it was healthy consolidation and you can be sure the dip buyers would be willing to jump in if there is more downside.
This market has had two significant trends for a while. One-way action to the upside and deadly dull volatility. Even the bulls are happy to see a little red on the screens once in a while as it is nice to have some variety, but it is amazing how a market that has made so many highs this year can be so lacking in excitement and energy.
A few more mixed days would be a nice setup going into earnings reports next week, but the dip buyers are never patient enough to let some decent pullbacks occur.
It was a slow and negative day but nothing has changed.
Have a good evening. I'll see you tomorrow.
At the time of publication, Rev Shark had no positions in the stocks mentioned.