OK, I’m back from a road trip that featured spotty connectivity, so pardon the missed week in review. In reality, there wasn’t much to review beyond the midweek commentary already posted.
This week is a continuation of the recent theme: risk aversion. Monday the SPX opened with a gap up and closed with a bout of selling. It’s Tuesday and we’ve opened gap down, with Treasuries off to the races again. Gold is consolidating, energy is down, and ag commodities are up. The US Dollar is falling, the Yen is up sharply, and the euro is finding a little support.
That’s the current snapshot in brief, but what does it mean? Poor market action in the short term. Oversold readings lead me to suspect that stocks are due for a small bounce, but the news flow and the price and volume action are driving market pessimism.
On the long term holding side, the energy majors still look silly cheap to me. For a short term trade, I still like oil near $70, and will until that price level is violated to the downside.