Tuesday was another volatile session for the market, with stocks opening higher, selling off, and then recovering into the close.
Bonds continued to see strength, and if the ECB delivers on Thursday we could see $TLT spike further to the upside.
A sharp late day rally left stocks off their lows, or OTL, which seems to be the theme in 2015. Yesteryday's reversal almost brought stocks back into positive territory, today's snap back could only turn today's losses from large one's into modest ones.
It's already been a volatile week full of wild prices swings and collapses, including copper, which was down some 7%+ last night before recovering some of its losses and ending.... you guessed it... Off The Lows or OTL.
The market collapses mid-day yesterday, giving up all of its early gains and then some, before recovering into the close. This morning, continuing the 2015 theme of volatility, the market is set to open over 1% lower. There is heavy volume before the market, and we could see heavy selling across the board today.
Here is what I am reading this morning:
Stocks rallied today to end a 5 trading day losing streak. Leading the way were retailers with $WMT, $M, and $JCP soaring higher. $BIG, $Z, and $CMG also rocketed higher, erasing what had been a terrible start to 2015. Is today's action indicative of what we will see going forward? Is that V bottom coming?
With Oil falling last year I posited the possibility that this decline could have some pretty dire consequences. While cheaper gas prices are a boon for consumers, what are the long term consequences of the 50% 7 month collapse in oil prices? Is this another bubble bursting that bears watching and will it lead to a stock market collapse? I think it would be naive not to explore this possibility.