The routine late-day bounce again took some of the sting out of today’s action, perhaps in anticipation of the FOMC rate decision tomorrow. In recent memory late day bounces had not being market friendly next day, but the market is probably still oversold enough to see a further bounce. The big picture is not very pretty and we are seeing the development of a downtrend with a series of lower lows and lower highs. There are a lot of talks about failed bounces; at the same time the bears had not being able to make much progress with the disaster in Japan and continuous Middle East turmoil. If the bears don’t shape up soon, this could turn into another good consolidation for the bull run.
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