For a third straight day the market opened poorly on Spain and Greece worries and then rallied. Spain has agreed to invest in Bankia, the country’s 4th largest bank; effectively nationalizing it. As with previous attempts, the rally fizzled in the last couple of hours. We still finished solidly in red with a slow grind lower and intraday bounces seemed to sap the bulls’ energy to finish in the green.
On the one hand the slow drip lower fails to bring a true capitulation bottom. On the other hand, the Sunday night future support were tested 3 days in a row and held. CSCO is down about 9% and PCLN is down about 4% after earnings. Last three nights and morning sessions had been absolutely brutal for the bulls, how they handle these earnings or any more drama from Europe will determine if the selling is indeed drying up.
