It doesn’t take much to stampede the herd when markets are oversold and plenty of nervous money is still dominant.
Crude oil, which had been an anvil around stocks neck for some time, gained sharply once again on rumors from the UAE OPEC could meet to coordinate production cuts. But, should that happen, cheating would begin almost immediately. Nevertheless, crude oil had been extremely oversold, so the herd was easy to spook.
Bulls had it in mind to close index green on the week but only Transports were able to comply. So the volatility continues.
Getting more mojo for bulls was JPM’s Jaime Dimon who bought $26 million of the company’s battered stock. I think he can handle it even if the timing proves to be off.
All the previous recent gainers (Treasury Bonds, Gold, and so forth were weak. Beaten down and/or most shorted were squeezed higher. Overall, what can happen over the long Holiday weekend, is something to be feared and positions must be squared-up.
In other news, economic data reported Friday wasn’t very supportive of a rally. Retail Sales were flat 0.2% vs 0.2% expected & prior 0.2%. The data was better given seasonal adjustments which is manipulative which doesn’t seem supportive. Import Prices were down -.0.1% and Export Prices fell to -.0.8%; Business Inventories flat at 0.1% vs 0.1% expected & prior 0.1%; and, important Consumer Sentiment fell to 90.7 vs 92.5 expected & prior 92.
Market sectors moving higher included: Almost everything.
Market sectors moving lower included: Volatility (VIX), Gold (GLD), Bonds (TLT), Investment Grade Corporate Bonds (LQD), Euro (FXE), Japanese Yen (FXY).
Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red). Dependent on the day (green) may mean leveraged inverse or leveraged short (red).
Volume Friday even on the ramp higher was light comparatively. Breadth per the WSJ was quite positive.
This commentary is short due to outside activities preventing my doing anything more.
The volatility remains and you’ll note the VIX, despite the gains Friday, didn’t move much. That said, every dog has its day.
Let’s see what happens.
Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.
Top 50 Investing Blogs.
Top 25 Best ETF Newslettersin 2015.
ETF Digest was awarded one of the most informative ETF websites in the10th Annual Global ETF Awards.
Disclaimer: The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell only any security. Market sectors and related ETF's are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotation's aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com